RBA: Are your home loan repayments going up next week?

The cash rate currently sits at 3.85%

The Reserve Bank of Australia is meeting on Tuesday to decide what to do about interest rates.

This will be the second of eight meetings for 2026. It already increased the national cash rate by 0.25% last month, which meant lenders increased their variable home loan rates in response.

Although it was then expected the RBA would pause for a while to monitor the impact of that rate rise, the conflict in the Middle East has changed things.

What are the chances of another rate hike?

Frustratingly, this depends who you ask.

Finder surveys economists ahead of every RBA meeting and this month they're leaning more towards a hold. Only 38% said they believed there would be another increase.

But it's important to remember that the survey is live over a few days and it was really amongst those few days that things started to change.

The ASX predictions jumped from a 31% chance of an increase to a 66% chance in just 2 days.

Here's a look at the prediction tracker from the ASX:

All 4 major banks are also expecting the cash rate to increase.

Why would the cash rate rise again so soon?

Over the last couple of weeks, the Middle East conflict has impacted global economies.

The price of fuel has risen for Australian drivers, which also has a knock-on effect of anything that's transported in fuel-run vehicles. Like, groceries and other essential goods.

The cost of fertiliser has also risen as it becomes harder to source from the Middle East. This could increase the price of our produce.

Inflation is the change in how much things cost. So, if we're paying more for our fuel, groceries and other products, inflation will rise.

The RBA could look to get on the front foot of that by increasing the cash rate now.

What are people saying?

Increasing the cash rate so that people have higher mortgage repayments, at a time when things are so obviously more expensive, is a harsh decision to make. But one that the RBA would be hoping could save the economy down the track.

Author and professor at Queensland University of Technology, Noel Whittaker, isn't so sure though.

"This is no time for the Reserve Bank to be raising interest rates. There's no point making Australian householders pay more on their mortgage to combat inflation that is not of this country's making," Whittaker said.

AMP's Shane Oliver does believe the RBA will go down that road.

"We expect that the RBA will raise rates...reflecting concerns about a further boost to inflation and inflation expectations as a result of higher energy prices flowing from the US/Israel war with Iran at a time when inflation is already above target," Oliver said.

Time to look at your home loan

Mortgage broker Joseph Daoud says homeowners should get on the front foot of any rate rises by looking at refinancing their home loans.

"If refinancing is on your radar, timing is becoming critical. Many borrowers are reviewing their options now rather than in a few months' time, when rate movements and changing lender policies could mean fewer opportunities and less flexibility," said Daoud.

Daoud pointed to Roy Morgan research which estimated that 23.9% of Australian mortgage holders were "at risk" of mortgage stress in January 2026. This is particularly troubling for newer borrowers who may have used first home buyer schemes to enter the market.

"For the large number of Australians who entered the market with 5% deposits and minimal buffers, the margin for error is shrinking and they'll be feeling the pressure as costs rise."