Commonwealth Bank predicts February rate hike adjustment by RBA

Australia’s Commonwealth Bank predicts the Reserve Bank will raise interest rates by 25 basis points to 3.85% in February 2026, marking a shift from its previous softer forecasts. This expectation follows an economic upswing, with growth projected at 2.3% by year’s end, driven by increased consumer spending and private investment. However, inflation progress has stalled, prompting the need for the rate hike to help return inflation to target. NAB also anticipates a rate increase in February and May, reflecting a consensus among major banks.

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