With the RBA Meeting Just Days Away, Here's What Borrowers Should Be Doing Now

​

28th April 2026

​

Australia's Reserve Bank meets again on 5 May, and for the first time in years, "will they cut?" isn't part of the conversation. The question now is how much further the cash rate has to climb, and what that means for your home loan.

​

Markets are currently pricing in roughly a 62% chance of another 25 basis point hike next week. That would lift the cash rate from 4.10% to 4.35%. Each of the big four banks (ANZ, CBA, NAB and Westpac) is forecasting a May rise, and Westpac has gone further, tipping a peak of 4.85% by August off the back of three more hikes this year.

​

For borrowers, that's a meaningful shift in a short space of time. Less than 12 months ago, the conversation was about how quickly rate cuts might arrive. Now, the smart money is on more pain before any relief.

​

What's actually driving this

​

Two things, mostly. Inflation picked up materially through the second half of 2025 and remains stubbornly above the RBA's 2 to 3% target, with services inflation in particular proving sticky. On top of that, higher fuel prices flowing from the Middle East conflict have added pressure to headline CPI and lifted short term inflation expectations.

​

The RBA's view, reinforced in its March minutes, is that demand is still running ahead of the economy's capacity to supply it. Keeping policy restrictive is the only way to bring inflation back to target without expectations becoming unanchored.

​

What it means for your repayments

​

If you're on a variable rate, another 0.25% hike will almost certainly be passed on by your lender. On a $600,000 loan over 30 years, that's roughly an extra $90 to $100 per month in repayments. If Westpac's full forecast plays out, with three more hikes totalling 0.75%, the same loan would cost around $280 more per month than it does today.

​

Borrowing capacity also takes a hit. Canstar's research suggests each 0.25% hike can shave around $12,000 off an average earner's borrowing power. For anyone shopping for a property right now, that's worth factoring in before you make an offer.

​

If you're on a fixed rate, you're protected for now. But lenders have already started repricing fixed products in anticipation. New fixed offers are notably less attractive than they were six months ago, and borrowers rolling off a fixed term this year will be facing a meaningfully higher rate when they refinance.

​

What we're telling clients to do this week

​

The honest answer is that nobody can perfectly time the RBA. But there are a few things worth doing now regardless of what happens on 5 May.

​

Stress test your budget. Work out what your repayments would look like with another 0.25%, 0.50% and 0.75% on top of where you sit today. Knowing the number is the first step to managing it.

​

Review your current rate. If you haven't checked your interest rate against the rest of the market in the last 12 to 18 months, you're probably paying more than you need to. Lender competition for new business remains strong even in a rising rate environment, and existing customers are often the ones being charged the loyalty tax.

​

Think carefully about fixing. Fixed rates can offer certainty, but they also lock you out of any cuts later down the track and usually carry restrictions on extra repayments. A split loan, part fixed and part variable, is worth a conversation if you want some protection without going all in.

​

Build the buffer while you can. If your budget allows, every dollar you put in offset or redraw now is a dollar working harder against a higher rate.

​

The bottom line

​

The 5 May decision will move markets one way or the other, but for most borrowers, the bigger question isn't what the RBA does next Tuesday. It's whether your current loan is still the right loan for the environment we're now in. That's something we can help you work through in a 15 minute conversation, no obligations.

​

If you'd like a free review of where your loan sits against the current market, get in touch with the Claremont team. We'll give you a straight answer on whether it's worth doing anything, and if it isn't, we'll tell you that too.