Interest RatesRBA Forecast

RBA Cash Rate September 2026: Why Banks Are Suddenly Split on a Hike

Three weeks ago, all four major banks expected the RBA to hold for the rest of 2026. Hot July inflation data has changed that. NAB, ANZ and CBA are now forecasting a hike before year end, while Westpac remains the lone holdout. Here is what changed, and how lenders are already positioning ahead of the 29 September decision.

By Raj Bhangu|Published September 1, 2026|9 min read

Will the RBA raise interest rates in September 2026?

It is genuinely uncertain. NAB expects a 25 basis point hike to 4.60% at the 29 September meeting. ANZ and CBA also expect a hike to 4.60%, but not until November. Westpac is the lone holdout among the majors, still forecasting a hold at 4.35% through the rest of 2026. The trigger for the hawkish shift was July inflation data: headline CPI eased to 3.5% but trimmed mean inflation, the RBA's preferred underlying measure, held steady at 3.6%, still well above the 2-3% target band.

Key Takeaways

1NAB, ANZ and CBA have all revised their forecasts to expect a further RBA rate hike before the end of 2026, reversing their view from just three weeks ago.
2NAB expects a 25 basis point hike to 4.60% at the 29 September meeting, ANZ and CBA expect the same move in November.
3Westpac remains the lone major bank still forecasting a hold at 4.35% through the rest of 2026.
4July headline inflation eased to 3.5% from 3.8%, but trimmed mean inflation held at 3.6%, both still above the RBA's 2-3% target band.
5Despite the hawkish forecasts, lender competition has intensified: 49 lenders now offer an owner-occupier variable rate under 6%, up from 38 in early June.
6All four major banks still agree that once the cycle turns, cuts are likely in 2027, though the starting point for those cuts is now less certain.

A Sharp Reversal in Three Weeks

When the RBA held the cash rate at 4.35% on 11 August 2026, all four major banks were aligned on a hold for the remainder of the year. That consensus has now broken down. Following the release of July inflation data in late August, NAB, ANZ and CBA each revised their calls to expect a further hike, while Westpac held its position as the sole dove.

Major Bank Cash Rate Forecasts, September 2026

Where each bank expects the cash rate to be by the time it next moves

Three of the four majors now expect a hike to 4.60%. Westpac is the outlier, still expecting a hold at the current 4.35%.

Bank	Current view	Forecast level
NAB	Hike in September 2026	4.60%
ANZ	Hike in November 2026	4.60%
CBA	Hike in November 2026	4.60%
Westpac	Hold through the rest of 2026	4.35%

The Inflation Data Behind the Shift

The trigger was the July inflation print. Headline CPI actually eased, from 3.8% in June to 3.5% in July, which on the surface looks encouraging. The problem is trimmed mean inflation, the RBA's preferred measure of underlying price pressure, which held steady at 3.6% rather than continuing to fall.

Inflation, June vs July 2026

Both measures remain above the RBA's 2-3% target band

Headline inflation eased, but trimmed mean stalling at 3.6% is what concerns the RBA and the bank economists who revised their forecasts.

CommBank senior economist Trent Saunders described the figures as stronger than anticipated, providing less reassurance that underlying inflation was continuing to ease, and said the data raised the risk that further monetary policy tightening could be required.

Lenders Are Not Waiting to Find Out

What makes this moment unusual is that lender competition has not slowed down despite the more hawkish outlook. On Canstar's database, 49 lenders now offer at least one owner-occupier variable rate below 6%, up from 38 at the start of June, and 31 lenders have cut new-customer variable rates since then.

Two Different Signals, Same Market

Economists forecasting a cash rate hike and lenders cutting variable rates are not actually contradicting each other. Lender rate cuts reflect competition for new customers and lenders' own funding costs, not a view on where the cash rate is heading. If the RBA does hike, expect these same lenders to reprice upward on both new and existing loans, the way they always do when the cash rate itself moves.

For a full breakdown of how this plays out across different loan types, including investment, commercial, and SMSF commercial lending, see our companion article on how rates compare across loan categories in September 2026.

What Happens on 29 September

The RBA's next Monetary Policy Board meeting runs over two days, with the decision released at 2:30pm on 29 September 2026. NAB is the only major bank currently expecting a move at this specific meeting. ANZ and CBA both push their hike calls out to November, meaning even the hawkish banks see a roughly even chance of a further hold in September before a move later in the year.

Despite the more hawkish near-term view, all four major banks continue to forecast rate cuts starting in 2027, though the starting cash rate level those cuts begin from is now less certain than it was three weeks ago.

Frequently Asked Questions

July inflation data prompted the reversal. While headline CPI eased from 3.8% to 3.5%, trimmed mean inflation, the RBA's preferred measure of underlying inflation, held steady at 3.6% rather than continuing to fall. That stalling in the underlying measure was enough for NAB, ANZ and CBA to revise their forecasts from a hold to a hike, while only Westpac maintained its hold call.

NAB is currently the most hawkish of the major banks, forecasting a 25 basis point hike to 4.60% at the 29 September 2026 meeting. ANZ and CBA also expect a hike to the same level, but not until the November meeting. Westpac does not expect a hike at all in 2026.

Lender rate movements and RBA cash rate forecasts are driven by different factors. Individual lenders cut rates to win new customers and reflect their own funding costs, which is a competitive decision independent of where the cash rate is heading. If the RBA does hike, lenders will reprice both new and existing variable loans upward regardless of any competitive discounting they have done in the meantime.

It depends on your certainty needs and risk tolerance. Fixed rates already price in the market's expectation of future cash rate moves, so a hike being partly priced in does not necessarily mean fixing now guarantees a better outcome than staying variable. With bank forecasts genuinely split for the first time in months, this is a good moment to model both scenarios against your specific loan with a broker rather than guessing.

Trimmed mean inflation removes the most extreme price movements (both rises and falls) from the inflation calculation, giving a clearer read on persistent, underlying price pressure than the headline CPI figure, which can be swung by volatile items like fuel or fresh food. The RBA treats trimmed mean as its preferred measure, which is why July's steady 3.6% trimmed mean reading mattered more to bank economists than the improvement in headline CPI.

Uncertain Rate Outlook? Get a Plan, Not a Guess

With bank forecasts split for the first time in months, now is the time to model both a hike and a hold against your actual loan, not wait and see.

Raj Bhangu

Principal Mortgage Broker, iSmart Finance Group

Licensed Mortgage BrokerCredit Representative 481761FBAA Member

Raj Bhangu is the principal broker at iSmart Finance Group, specialising in home loan finance and helping clients navigate RBA rate cycles and lender policy changes across Sydney and beyond.

Published: 1 Sept 2026

Sources & References

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iSmart Finance Group ACN 608 986 554 is Credit Representative 481761 of BLSSA Pty Ltd ACN 117 651 760 (Australian Credit Licence 391237). We are members of the Finance Brokers Association of Australia (FBAA) and comply with the National Consumer Credit Protection Act 2009.

Our content is based on industry expertise, regulatory guidelines from ASIC and APRA, and data from the Reserve Bank of Australia. All information is current as of the publication date and subject to change.