87% Priced, All Four Majors Call 4.85% (RBA Decision Preview, 3 November 2026): What to Expect and What It Means for the Aussie

The Reserve Bank of Australia announces its November decision at 2:30pm AEDT on Tuesday 3 November 2026 (03:30 UTC), together with new quarterly forecasts in the Statement on Monetary Policy. All four major banks now expect a 25 basis point hike to 4.85%, which would be the fifth rise of 2026 and the highest cash rate since 2008. Markets put the odds at about 87%. Because the hike is so heavily priced, the Aussie is likely to move on the forecasts and the guidance about what comes after it, not on the decision itself.

Two weeks ago this meeting was close to a coin toss. Then a deputy governor's speech and a hot inflation print moved it to nearly certain. Below: what moved it, what the new forecasts need to show, the three plausible outcomes, and how each one reaches the Australian dollar.

When the decision lands, and what comes with it

The Monetary Policy Board meets over 2–3 November and announces at 2:30pm Sydney time. Daylight saving started in October, so that is now 03:30 UTC, an hour earlier than the 04:30 UTC release in September. For traders in New York it is 11:30pm on Monday 2 November. The full schedule is on the RBA's events calendar.

November is one of the four quarterly meetings, so the decision comes with the Statement on Monetary Policy and its new forecasts for inflation, unemployment and growth. Bullock's press conference follows at 3:30pm AEDT. The timing puts the release on Melbourne Cup day and a few hours before polls open in the US midterm elections. We cover that event in our midterms preview. Liquidity in the Aussie will be thinner than usual for the rest of the session.

How a coin toss became an 87% favourite

The Board hiked to 4.60% on 29 September. As we covered in our September decision post, it left the door open to more but did not commit. Over October, market pricing for a November hike rose and fell with each data release:

Sources: ABC News (Bloomberg data) on 21 and 28 October; The Adviser on 28 October.

The labour market data briefly took November off the table. According to ABC News, unemployment rose to 4.7% in September. Hauser called that "a little weaker than we and others have been expecting." Speaking at a Citi conference in Sydney on 21 October, he then moved the focus back to inflation. He warned of "an increasing share of businesses who are thinking that, maybe, sort of 3 per cent, 3.5 per cent [inflation] is the new normal" and said "We can't allow expectations to shift away from target."

The CPI a week later supported that warning. The ABS reported headline inflation of 4.3% in the year to September, up from 4.0%. Prices rose 0.8% in the month and 1.3% over the quarter. The trimmed mean rose 1.0% in the quarter. In ABC's coverage, Betashares' David Bassanese noted that "back in August, the RBA forecast a trimmed mean quarterly gain of 0.8 per cent in the September quarter." Housing rose 5.2% over the year and was the largest contributor. The ABS put the rise in fuel down to higher world oil prices.

What the banks expect, and where they differ

After the CPI release, all four majors call the same move, according to The Adviser. CBA and NAB switched from a hold to a hike, and Westpac and ANZ kept the hike calls they already had. They differ on what comes after November, and that is the part the currency will trade.

• CBA. Head of Australian Economics Belinda Allen called it "an insurance hike" and said "the RBA has picked a side and is leaning into the fight." CBA expects holds in December and February after the hike (CommBank, 28 October).
• Westpac. Chief Economist Luci Ellis expects a majority of the Board to back a hike, though some members may dissent. Further hikes are "not currently our base case," but the risk of another "most likely in February" has increased (Westpac, 28 October).
• NAB expects a hike to 4.85% followed by a pause.
• ANZ said the September data "cements the case" for a 25bp hike and pointed to oil prices, the AI investment boom and domestic capacity constraints.

The Westpac note also quotes the Governor telling a Senate hearing that "the labour market seems a little tighter than we had previously judged." That line matters for how the Board reads the rise to 4.7%. If it treats the higher unemployment rate as the intended cooling rather than as a reason to stop, the Board can hike and keep a tightening bias.

Three scenarios for 3 November

The table is a map of transmission channels, not a forecast. Even the hold scenario would come with guidance. A "hawkish hold" that pointed to December would cushion the move, because markets are already fully pricing a hike by Christmas, according to The Adviser.

How each outcome reaches the Aussie through the five factors

Interest rates. On the US side, the Federal Reserve held at 3.75–4.00% on 28 October, with two dissents from Lisa Cook and Beth Hammack, both of whom preferred a quarter-point hike. A hike to 4.85% would put the cash rate 85 basis points above the top of the Fed's range. Most of that is already in the price. What AUD/USD trades on 3 November is how much the RBA's expected path moves relative to the Fed's, and the Fed's next steps depend on the US data still to come. Our Fed October preview sets out that side.

Growth. Higher rates are already working on the economy. Unemployment at 4.7% and falling house prices are how they reach demand. The new unemployment forecast matters here. A higher projected peak would tell the market the Board expects to give back some of the tightening later in the cycle, which weighs on the growth side of the Aussie even if rates go up now.

Commodities. Fuel was a large part of the CPI overshoot, and the ABS attributed it to world oil prices. Australia is a net energy importer at the pump but a large exporter of LNG and coal. Higher energy prices therefore push inflation, and so rates, higher while also supporting export income. For the wider commodity picture this month, see our World Bank commodity outlook post.

Risk sentiment. The Aussie is still one of the most risk-sensitive majors. The decision lands hours before US midterm polls open, so moves in global equities over the following 24 hours could easily outweigh the reaction to the RBA itself.

Positioning. Rising from below 20% to about 87% in two weeks means a lot of the hike trade has already been put on. When a decision is this widely expected, an in-line outcome often brings profit-taking, and only a surprise in the guidance moves the currency further. That is one reason the September reaction faded.

What to watch on the day

1. The first line of the statement. It will show whether the cash rate is at 4.85% or 4.60% and whether the decision was unanimous. A split vote on a hike would point to a pause afterwards.
2. The trimmed-mean forecast path. Watch where it is in late 2027 and whether it returns to the 2–3% band within the forecast horizon.
3. The guidance clause. September's wording committed the Board to "increasing the cash rate target further if needed." If it survives a hike, the bias is still toward tightening.
4. Bullock's answer on February. In September she said the Board needed to "see how these four interest rate rises feed through." If she gives a similar answer about five hikes, the market will read it as a pause.

For background on how the Bank reads inflation, see Australian inflation, the RBA and the dollar. For how we build these notes, see about pip theory.

Educational macro context only — not investment advice.