Will the RBA lift the cash rate to 3.85% today?

Markets lean toward a hike, while some economists argue for a pause to assess slowing inflation. The decision will depend on recent price data, demand signals, and the Board’s risk view. Focus on the statement and guidance, as that will shape expectations for RBA interest rates beyond today.

How would a hike affect home loans in Australia?

Variable mortgage rates usually move soon after a policy change. A 25 basis point hike would lift repayments and reduce borrowing capacity. Fixed rates depend on wholesale funding and bond yields. Borrowers can ask lenders for repricing, consider offsets, and compare refinancing offers to cushion higher RBA interest rates.

Why do some economists prefer a hold at 3.60%?

They see easing inflation momentum and want to avoid overtightening that could raise unemployment more than needed. A pause tests if past tightening is already restraining demand. If Australia inflation keeps cooling, the case for further increases in RBA interest rates weakens, reducing the risk of a deeper growth slowdown.

What markets should investors watch around the RBA meeting?

Watch AUD, short‑dated bond yields, bank stocks, REITs, and discretionary retailers. The immediate reaction depends on whether a move was fully priced and on guidance. If RBA interest rates are seen peaking soon, duration and defensives may stabilise. If guidance stays firm, higher‑beta and leveraged names could lag.

Global Market Insights

RBA February 3: Markets Tip 3.85% Hike as Economists Warn to Hold

ByDanny Kontos February 3, 2026February 3, 2026

RBA interest rates are front and centre today as markets lean toward a cash rate move to 3.85% at the RBA meeting. Some economists, including AMP and Deutsche Bank, argue a hold at 3.60% could protect a fragile private‑sector recovery as Australia inflation shows slower momentum. The call will shape funding costs, mortgage rates, the Australian dollar, and rate‑sensitive shares. We outline the case for hike or hold, the likely market reaction, and practical steps for borrowers and investors.