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# Reserve Bank of Australia holds cash rate at 4.35% in August as inflation lingers
- URL: https://www.theglobalbanker.com/reserve-bank-of-australia-holds-cash-rate-4-35-percent-august-2026/
- Published: 2026-08-12T17:48:00.000Z
- Updated: 2026-10-02T00:50:54.000Z
- Description: The RBA left the cash rate target at 4.35% effective 12 August 2026, its second consecutive hold after a May hike, with the next update scheduled for 29 September.
- Author: TGB Editorial Team
- Tags: Central Banks, Asia-Pacific

The Reserve Bank of Australia held its cash rate target at 4.35% on Tuesday, effective 12 August 2026, opting to keep policy on hold as inflation lingered above the target band. The decision marked the second consecutive hold following the tightening step delivered in May and was published on the central bank's website.

The Board said inflation was not expected to return to around the midpoint of the target range until late 2027, with upside risks to that projection, and that the decision was unanimous. The next scheduled update from the Board is set for 29 September 2026, when policymakers will have a further set of inflation and activity readings to assess.

#### SECOND HOLD AFTER MAY TIGHTENING

With monetary policy judged to be somewhat restrictive, the Board said it decided to leave the cash rate target unchanged while it assesses how the economy is evolving. It said financial conditions had tightened following three increases in the cash rate target since the beginning of the year, and that the economy appeared to be slowing as expected.

The statement said labour market conditions had eased by a little more than expected in recent months, while the disruption to global oil supply was adding directly to inflation, with higher fuel prices being passed through to other goods and services.

The statement said the Board would continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if upside risks materialise. It flagged the uncertain resolution of the Middle East conflict and the time needed for global oil supply to recover as key uncertainties.

#### NEXT DECISION ON 29 SEPTEMBER

The next monetary policy decision is scheduled for 29 September 2026, when the Board will have further monthly CPI readings and the June-quarter national accounts to inform its assessment.

Governor Michele Bullock held a media conference after the decision, and the minutes of the meeting are due two weeks after the decision. 

The statement noted that housing prices were falling in some capital cities, new housing loans had declined noticeably and consumer spending growth was slowing gradually, while growth in business debt and investment was strong.