Will the RBA raise the cash rate again in August 2026?

It is a real possibility, but it is not locked in. The RBA held the cash rate at 4.35% at its June 2026 meeting after lifting rates three meetings in a row earlier this year. Whether the board moves again in August hinges almost entirely on the June-quarter inflation figures landing before the meeting.

It is a mistake to trade your mortgage strategy on a coin-flip. The honest position for any broker is this: the door to a further rise is open while inflation runs hot, so plan your household budget as if one more 0.25-point increase could land — and treat any hold or cut as a bonus rather than the base case.

Why has the RBA hiked three times this year?

Because inflation has stayed stubbornly above target. Underlying (trimmed mean) inflation — the RBA's preferred measure that strips out volatile items — was 3.4% over the year to the December 2025 quarter, with headline inflation at 3.6% (RBA Statement on Monetary Policy, February 2026). Both sit above the RBA's 2–3% target band, which is what pushes the board to keep monetary policy tight.

The three rises tracked a clear path:

That is a full 0.75 percentage points added in a little over three months, followed by a pause in June. The key takeaway: the RBA is signalling "higher for longer" until it sees inflation return convincingly to the band.

How much have the rate rises added to a typical mortgage repayment?

More than most people realise. As a rough rule of thumb, each 0.25-point rise adds around $15 per month for every $100,000 of variable debt on a 30-year loan. Stack up the three 2026 hikes and the effect compounds quickly.

On a $600,000 variable loan, roughly 0.75% of extra rate translates to about $270 more each month — close to $3,200 a year. On a $750,000 loan you are looking at around $340 a month. These are indicative figures to show the direction and scale; your exact number depends on your rate, balance and remaining term. Run your own scenario through our home loan repayment calculator before you make any decision.

There is an obvious trap in that arithmetic: borrowers who set up their loan when the cash rate was near record lows and never re-checked their buffer. When three rises land in a single year, a repayment that felt comfortable can quietly become a squeeze.

The most common moment is when we sit down together, work out the repayment they can genuinely afford, and then compare it to the actual repayment on the loan they had in mind. If they have not done a full budget beforehand, that gap is where the surprise lives — so we work the real numbers through with them first, then decide whether the loan amount still makes sense or whether it needs to come back a notch.

What should borrowers do right now?

Focus on the things you control rather than forecasting the RBA. Five practical moves do most of the work in a hiking cycle:

  1. Stress-test your budget for one more 0.25% rise. If that number frightens you, act now — not after the increase.
  2. Check the rate you are actually paying against the sharpest rate on the market. A gap of even 0.30–0.50% is common and costly.
  3. Use an offset account. Every dollar sitting in an offset reduces the balance you pay interest on, dollar-for-dollar, while staying accessible.
  4. Direct any spare cash flow at the loan, or park it in the offset, to build a buffer ahead of the next decision.
  5. Review, don't panic. Restructuring, not reacting to headlines, is what protects your position.

Self-employed borrowers have extra levers and extra hurdles here — our guide on lender tips for self-employed applicants walks through how to present income cleanly when you want to switch.

Does refinancing actually help when rates are rising?

Yes — more often than people expect, because refinancing is about your margin, not the RBA's direction. Even in a hiking cycle, the difference between a loyal customer's rate and the sharpest rate a lender will offer a new borrower can be substantial. Closing that gap saves money regardless of where the cash rate heads next.

Refinancing can also do more than shave the rate. It can add an offset, consolidate higher-interest debt, or reset the loan term to ease monthly pressure while you ride out the cycle. The catch is that lender serviceability tests now assess you at your rate plus a buffer (commonly around 3%), so borrowing capacity is tighter than it was — which is exactly why getting the structure right matters. Our home loan refinancing service is built around exactly this kind of review, and we will tell you plainly if staying put is the better call.

Should I fix my rate, split it, or stay variable?

There is no universal answer — it comes down to how much certainty you need and how you use your loan. Fixing locks your repayment for a set term, which helps if a further rise would genuinely stretch you, but fixed loans typically remove or limit the offset and cap extra repayments. Staying variable keeps full flexibility and the benefit of any future cut, at the cost of ongoing uncertainty.

A split loan — part fixed, part variable — is the common middle ground: certainty over one portion, flexibility over the rest. The right mix depends on your cash flow, your goals and your appetite for risk, so it is worth modelling properly rather than following a headline. If you would like a broker to run the numbers on your specific loan and map out the options, book a 30-minute strategy call with us using the section below — general information here is no substitute for advice tailored to your situation.

The question I actually ask is simple: if your rate went up by a couple of percent, how would you handle the repayments? If they are comfortable, a variable loan usually suits. If it would be tight, a fixed term to start with buys some certainty until their income grows. In practice most people land on a split — part fixed, part variable — which gives them a safety net while still letting them use an offset account against the variable portion.

Frequently asked questions

Will the RBA definitely raise the cash rate in August 2026?

No one can say for certain. The RBA held at 4.35% in June 2026 after three rises, and its next move depends on the June-quarter inflation data. Another hike is a genuine risk while underlying inflation stays at 3.4%, above the 2–3% target band, so it is wise to plan for higher-for-longer rather than bet on a cut.

Should I fix my home loan rate now that the RBA is hiking?

It depends on your goals and cash flow, not on trying to pick the peak. Fixing buys certainty but usually removes your offset and limits extra repayments, while splitting part-fixed and part-variable is a common middle ground. There is no one-size answer, so it is best to model your own numbers with a broker before deciding.

Does refinancing still make sense when interest rates are rising?

Often yes. Refinancing is about the margin between your rate and the sharpest rate you qualify for today, not the direction of the cash rate. Many borrowers are still paying a loyalty penalty of well above the best advertised rates, and switching can also unlock a longer term or an offset to ease repayment pressure.

What happens to my repayments if rates rise another 0.25%?

As a rough guide, each 0.25-point rise adds roughly $15 per month per $100,000 of variable debt on a 30-year loan. On a $600,000 balance that is about $90 a month, or around $1,080 a year. Your exact figure depends on your rate, balance and remaining term.