RBA Raises the Cash Rate to 3.85%: February 2026 Decision

General information only. We are mortgage brokers, not financial advisers or accountants. Please have your own situation assessed before acting.

Published 4 February 2026. Figures and market conditions described here were current at that time and may have changed since.

This is a past RBA decision. The cash rate has changed since. See our latest RBA update and the current cash rate on our homepage.

At its first meeting of the year, the Reserve Bank of Australia (RBA) was unanimous in lifting the official cash rate by 0.25 percentage points, taking the rate to 3.85%.

According to the Australian Bureau of Statistics, household spending rose 1% month-on-month in November to a record $79.35 billion, seasonally adjusted. This represents a 6.3% annual increase, showing consumers are continuing to spend despite prolonged cost-of-living pressures. Analysts note that this persistent demand is adding further upward pressure on inflation and contributed to today’s rate hike.

In the property market, a new Hotspotting report has pinpointed ten key regions with strong long-term growth potential. Queensland features Inner Brisbane and the Sunshine Coast, while Tasmania’s Greater Hobart and Launceston also rank highly. Victoria’s City of Casey, Greater Geelong, and Latrobe City were highlighted for affordability and expanding populations. In New South Wales, Tamworth, Parramatta, and the Hunter Valley were identified as promising markets supported by infrastructure investment and migration trends.

As borrowers adjust to the latest rate rise, these regions are expected to attract increased attention from homeowners and investors seeking value, stability, and growth potential across 2026.

The RBA’s next meeting is scheduled for Tuesday, March 17.

Important: this is general information, not adviceFinfident Finance Brokers are mortgage brokers. We are not financial advisers, tax agents or accountants, and nothing in this article is financial, tax or legal advice or a recommendation to act. It doesn't take into account your objectives, financial situation or needs. Whether you fit the situation described here depends on your own circumstances, so please have them assessed before making any decision: talk to us about your lending options, and to a licensed financial adviser, registered tax agent or accountant for financial or tax advice. This article was published on 4 February 2026. Figures, rates and rules can change. Finfident Finance Brokers (ABN 94 679 280 801) is Credit Representative 569374 of Outsource Financial Pty Ltd (ACN 131 090 705), Australian Credit Licence 384324.