The Reserve Bank of Australia has raised the official cash rate by 0.25% to 4.10%. The decision was handed down on 18 March 2026, with five board members voting to lift rates and four voting to hold. If you have a variable rate home loan, your repayments are going up.

Here is what happened, why it happened, and what it means for you in plain terms.

What the RBA decided

The cash rate now sits at 4.10%, up from 3.85%. This follows a rise in February 2026, making it two back-to-back increases in as many months. The vote was not unanimous. Four board members wanted to hold, which tells you the decision was not straightforward. There is genuine debate inside the RBA about where things go from here.

All four major banks (CBA, NAB, Westpac, and ANZ) had forecast this hike. Most economists now expect another 0.25% increase in May, which would take the cash rate to 4.35% if it happens.

Why the RBA lifted rates again

The RBA has pointed to two main reasons for this decision.

First, inflation is running hotter than expected. Despite easing off its 2022 peak, price pressures picked up in the second half of 2025 and have not come down quickly enough. The board believes the economy still has too much demand relative to supply.

Second, the conflict in the Middle East has pushed global fuel prices sharply higher. That feeds directly into petrol prices here, which flows through to the cost of almost everything else. If those fuel prices stay elevated, inflation stays elevated.

Labour market conditions have also remained tighter than the RBA expected. Unemployment is sitting lower than forecast, which means wages are holding up, which means people still have money to spend, which keeps demand elevated. It is a cycle the RBA is trying to break.

What this means for your mortgage repayments

If your lender passes this increase on in full, here is roughly what changes:

  • On a $600,000 loan: around $91 more per month from this hike alone
  • Combined with February's rise: around $181 more per month than you were paying at the start of 2026
  • On a $1,000,000 loan: the combined two hikes add roughly $300 per month

The average owner-occupier variable rate is now sitting around 6.00% per annum. If May's expected hike goes ahead, that climbs further.

Your bank will write to you with the new rate. Most lenders will move within a few weeks of today's announcement.

Is now a good time to review your loan?

Two rate hikes in two months is exactly the kind of moment that is worth pausing on. Not because you need to panic, but because it is a reasonable prompt to check whether your current rate still makes sense.

Here is the thing most people do not realise: lenders regularly offer better rates to new customers than they give to existing ones. If you have had your loan for a year or more and have not reviewed it, there is a good chance you are on a rate that does not reflect what is available right now.

A rate review is not the same as refinancing. It starts with understanding where you actually sit and whether there is a meaningful gap between your current rate and what the market is offering. That takes a conversation, not a commitment.

What to watch for next

The next RBA meeting is in May 2026. Markets and major banks are pricing in another 0.25% increase, but that is not certain. The RBA will be watching inflation data closely between now and then. If fuel prices ease or domestic demand softens, the board may choose to hold.

The near-split vote today (5-4) is a sign the RBA is not on autopilot. They are watching the same data you are.

If you want to understand what today's rate change means for your specific loan, a quick call with a broker is the fastest way to get a clear answer. We look at your current rate, compare it against what is available, and tell you honestly whether it is worth doing anything about it.

No obligation. No pressure. Just a clear picture of where you stand.

Book a free rate review call with Swish Finance Brokers.

General information only. Not personal financial advice.