SYDNEY — The Reserve Bank of Australia's decision to raise interest rates for the fourth time this year will ripple through household budgets across the country, adding hundreds of dollars to monthly mortgage bills, squeezing borrowing power for would-be buyers and offering potential gains for savers.

The central bank on Tuesday lifted its cash rate by 25 basis points to 4.60%, the highest level in about 15 years. The unanimous decision brings the total increase in 2026 to a full percentage point, following rate rises in February, March and May.

The RBA said inflation remained too high, pointing to higher global energy prices tied to the widening conflict in the Middle East, demand linked to artificial intelligence and domestic capacity pressures. The board said "a further tightening in financial conditions is warranted to support a return of inflation to target," and signaled it could raise rates again if needed.

While mortgage holders feel the most direct impact, the decision affects renters, savers and prospective buyers in different ways.

Borrowers with variable-rate home loans will feel the effects most quickly, as banks typically pass rate increases on in full within weeks.

According to analysis by financial comparison site Canstar, the latest increase will add about $107 to monthly repayments on a $700,000 loan at the average variable rate, bringing the cumulative increase since the start of the year to $424 a month.

For a $750,000 mortgage, the latest hike adds about $114 a month, for a total increase of $454 a month this year.........

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