The Reserve Bank of Australia has raised the cash rate three times in 2026, bringing it to 4.35%. With the next RBA board meeting scheduled for June 15–16, borrowers across Australia are asking the same question: is another hike coming?
Where the Big Four Banks Stand
The major banks are divided. Some economists expect the RBA to hold steady in June, pointing to softening consumer spending and easing inflation data. Others — including Westpac’s economics team — have flagged the possibility of further increases if services inflation remains sticky.
For borrowers, the uncertainty itself is the problem. Whether rates hold or rise again, the three hikes already delivered in 2026 have materially changed what you can borrow and what you’re paying each month.
The Real Impact on Your Repayments
Each 0.25% rate increase adds approximately $91 per month to repayments on a $600,000 variable rate loan. Across three hikes, that’s an additional $273 per month — or roughly $3,276 per year — compared to where repayments sat at the start of the year.
For borrowers who stretched to their maximum capacity in late 2025, this increase can put genuine pressure on household budgets.
Borrowing Capacity Has Shrunk
Rate increases don’t just affect existing borrowers. They reduce how much new buyers and refinancers can borrow. Based on current lender servicing calculators:
- A single income earner may have lost approximately $36,000 in maximum borrowing capacity since the hikes began
- A couple on dual incomes could be looking at up to $72,000 less
For first home buyers using the 5% Deposit Scheme, this reduction can be the difference between qualifying for a property and falling short.
What You Can Do Before June 16
Regardless of what the RBA decides, there are practical steps you can take now:
1. Check Your Current Rate
Many borrowers are paying more than the competitive rates currently available. If your variable rate has crept above 6.50%, or your fixed rate is expiring in the next three to six months, a rate review could identify meaningful savings.
2. Lock In a Pre-Approval
Pre-approvals are assessed at today’s rates. If you’re planning to buy, securing approval now protects your borrowing capacity if rates move higher after June 16.
3. Understand Your Servicing Position
Lenders stress-test your application at rates well above the current cash rate. Knowing your actual borrowing capacity — not a rough estimate — helps you search with confidence and avoid wasted inspections.
Get a Borrowing Capacity Check
We’re running complimentary borrowing capacity assessments for anyone who wants clarity before the next RBA decision. Whether you’re buying, refinancing, or just want to know where you stand, we can give you the numbers in one conversation.
Call or text Daniel on 0430 11 11 88 or visit finhub.net.au to book a time.
Finance Hub and Networks Pty Ltd | ACL 573164 | ACN 644 141 613
Aggregated through Connective Credit Services Pty Ltd, ABN 51 143 651 496, ACL 389328.
Credit assistance provided. This article does not constitute financial advice. All figures are indicative and subject to individual circumstances and lender assessment criteria.
