The beginning of 2026 has proven uncertainty is the only certainty in interest rates, as in world affairs.
Australia’s interest rate landscape has become increasingly unpredictable, leaving borrowers, lenders, and mortgage brokers navigating one of the most complex environments seen since the rapid tightening cycle of 2022–23.
The Reserve Bank of Australia (RBA) moving to a rising cycle was a move widely considered “entirely unlikely just months ago,” according to Herron Todd White’s Month in Review - February 2026 report.
That February change reinforced what many in the lending industry already sensed: Traditional indicators are becoming harder to read, and volatility is now the baseline.
As a mortgage broker working directly with households feeling the pinch, the message to clients is simple: Forecasting rate movements has never been more difficult.
In 2026 we are seeing household stress becoming more visible. Rising credit card debt, now at a four‑year high, and record levels of personal loan issuance suggest families are relying more heavily on short‑term credit to manage everyday expenses.
At the same time, strong travel demand and persistent spending in certain sectors complicate the inflation picture, making RBA decision‑making harder to anticipate. Volatility in oil prices is then the cherry on top!
Yet the housing market remains resilient. Low housing supply is the real problem, continuing to prop up prices. This creates a difficult balancing act: Renters and borrowers are squeezed by higher monthly housing payments but still face competitive market conditions if they want to buy.
Ultimately, predicting interest rates has become an exercise in weighing conflicting signals. Inflation has been moderating, but not enough. Consumer sentiment is weakening, yet spending remains high in specific categories. Most banks expect hikes, but some economists still see room for stability.
So, should you fix your interest rate?
To fix or not to fix is a very individual question – relative to specific circumstances, not a general information article. However, it is an important question.
The current data is pointing to one thing: In this environment, uncertainty is the safest prediction of all.
That means the need for an experienced financial team around you assisting in financial decision making is more important than ever.