The Reserve Bank of Australia’s November Statement on Monetary Policy projects inflation will remain high for longer, with a return to the midpoint of its 2%–3% target range not expected until mid-2028. The outlook accompanies the Monetary Policy Board’s November decision to raise the cash rate target by 25 basis points to 4.85%. Higher global fuel prices and domestic price and cost pressures underpin the inflation outlook, despite slower spending. Housing prices have declined, and interest rate increases during 2026 are expected to further restrain spending and slow the economy over the next few years. The unemployment rate has risen and is projected to increase further, although the number of jobs is expected to continue growing.
RBA sees inflation staying high for longer as cash rate reaches 4.85%
The Reserve Bank of Australia expects inflation to return to the midpoint of its 2%–3% target range only in mid-2028, reflecting higher fuel prices and domestic price and cost pressures. Its Monetary Policy Board raised the cash rate target by 25 basis points to 4.85% at its November meeting. The economy is forecast to slow and unemployment to rise, while employment continues to grow.