Abrupt RBA turnaround as interest rates lifted just months after last cut
After a series of 2025 rate cuts and a property price surge, the Reserve Bank has abruptly reversed course, lifting rates less than six months after its last cut as inflation flares again.
A $700,000 home loan will now cost an extra $105 to service. (Image source: EyeofPaul/Shutterstock.com)
Central banks don’t like to perform monetary policy U-turns, but the Reserve Bank of Australia (RBA) has screeched on the brakes and changed direction on interest rates.
The RBA on Tuesday (3 February) hiked interest rates by 0.25 per cent, to an official cash rate of 3.85 per cent.
With inflation having risen at an expectedly fast pace
to 3.8 per cent, the RBA felt it was forced to act by lifting rates and trying to put a handbrake on consumer…
