RBA Weighs 25-Basis-Point Hike as Mortgage Stress Nears 2024 Peak

3 articles · Updated · Yahoo Finance Australia · Aug 25

RBA minutes showed board members debated lifting the cash rate by 25 basis points, with no case made for a cut, before leaving it at 4.35%.
Mortgage repayments are near their 2024 peak as a share of household disposable income, and the bank expects pressure to rise slightly as past rate hikes keep flowing through.
Households were still judged largely able to absorb higher payments because many borrowers hold sizeable prepayment buffers, even as extra mortgage payments have eased toward their long-run average.
Inflation remains above target—trimmed mean at 3.6% and headline at 3.8%—while the RBA flagged upside risks from the US-Iran war, AI-driven investment and resilient demand.
The bank has raised rates at three of five meetings in 2026, by 75 basis points from 3.60% to 4.35%, and said a still-strong labour market could leave room for further tightening.