As widely predicted, the Reserve Bank of Australia (RBA) has increased the cash rate by 0.25% at today’s meeting. The current cash rate now sits at 3.85%.
This month’s decision reflects the RBA’s commitment to restoring price stability, with the latest data indicating:
- Headline (annual) inflation has risen to 3.8% in the 12 months to December 2025 and remains above the RBA’s 2%-3% target range.
- Underlying (trimmed mean) inflation sits at 3.3%, the RBA’s preferred underlying measure, helping highlight that broad-based inflation pressures remain.
The cash rate increase aims to ease ongoing price pressures and anchor inflation expectations, while allowing the RBA to carefully monitor how tighter financial conditions affect household spending.
Today’s decision highlights the value of staying up to date with economic shifts and what they may mean for your finances.
Whether you’re weighing up a home purchase, refinancing to improve your loan terms, or exploring an investment property, this could be the right moment to reassess your plans.