RBA rate forecast: what the market expects in October 2026

Unemployment rose to 4.7% in September and employment fell by 39,300, the ABS reported on Thursday. The ASX rate tracker had put a 27 per cent chance on a November rise from 4.60% to 4.85% at Wednesday's close. After the jobs figures it fell to 16 per cent, and Monday's close had it at 22 per cent.

The big four banks' economists are still split two and two. ANZ Research sees a rise as "more likely than not", its podcast said after the figures. Westpac expects one too (Australian Broker). NAB's economists wrote that they "continue to expect policy to remain on hold, though we still acknowledge the risk sits with a hike". On Monday, CBA chief economist Luke Yeaman kept the hold call. "Our base case: the cycle wins, just," he said.

Outside the big four, EQ Economics' Warren Hogan says the RBA's leaders have "lost patience with inflation" and is sticking with November, Yahoo Finance reported today. JP Morgan's Tom Kennedy expects "rates on hold from here".

At CBA's markets conference on Monday, Assistant Governor Christopher Kent said he'd "always be a bit cautious about the monthly numbers". Some indicators show the labour market "has become less tight a bit faster than we might have forecast", he said. Policy is "somewhat restrictive", and the Board's question is whether it is restrictive enough.

In an r/AusFinance thread on the RBA's tougher talk, u/ArcticKnight79 wrote that rises hit people who "already borrowed money in the past", while their parents, who paid cash, keep spending. At Citi's conference today, two home loan industry chiefs were asked how much further rates could rise. "I don't think it's a lot more," said Liberty Financial's James Boyle. AFG's David Bailey said an extra 0.25 points "is really starting to push the envelope".

The September rise has now reached all 30 of our lenders with a reading from before the decision. Six were recorded in the past week: P&N Bank and RACQ Bank on 14 October, Macquarie on 15 October, and Bank Australia, Qudos Bank and Bank of Sydney on 16 October. All rose 0.25 points except Bank of Sydney's Basic Home Loan, up 0.15. Correcting last week's post: MyState Bank rose on 8 October. Its open banking feed still shows the old rates, so we now read its rate sheet.

That leaves Greater Bank's Great Rate Home Loan with the lowest variable comparison rate on our board, 6.10% (6.09% advertised), ahead of Up at 6.20%. In fixed rates, AMP Bank lifted three terms and Unity Bank cut its two-year fix by 0.15 points.

On a hypothetical $600,000 loan at 6.09% over 30 years, principal and interest, another 0.25 point rise passed on in full would add about $97 a month.

Deputy Governor Andrew Hauser speaks tomorrow morning. The September quarter inflation figures land on 28 October, with CBA expecting trimmed mean inflation of 1.0% and Westpac about 0.9%. The Board decides on 3 November, Melbourne Cup day, with new forecasts.