Australia raises rates again — and growth is cooling at the same time.

The Reserve Bank of Australia has lifted its rate from 4.60% to 4.85% in the fight against inflation. It is the fifth increase in 2026, and the highest level in 18 years.

The backdrop is softer: economic growth has slowed from 2.5% to 2.1%.

Higher borrowing costs, slower growth — a tough combination for households and businesses.