SYDNEY, May 2, 2026, 06:11 AEST
Borrowers in Australia are scrambling for stability. Commonwealth Bank of Australia reported a surge—searches for fixed-rate loan terms soared by more than 250% in March compared with the same month last year, ahead of what’s expected to be another Reserve Bank of Australia rate hike next week. “Knowing what your repayments will be over a period of time can make it easier to plan and manage expenses,” said Marcos Meneguzzi, CBA’s executive general manager for home buying. CommBank
The issue has fresh urgency: Australian mortgages remain mostly tied to variable rates, meaning repayments shift along with the RBA’s cash rate. That’s the key lever for borrowing costs. In its February policy statement, the RBA put the share of new and outstanding fixed-rate home loans at under 5%.
According to a Reuters poll out Friday, 30 out of 33 economists are betting the RBA will lift the cash rate by 25 basis points to 4.35% on May 5. ANZ, CBA, and NAB all think rates stop there. Westpac, though, is calling for 4.85%. “Inflation is basically too high in Australia,” AMP economist My Bui told Reuters. Reuters
Rate worries picked up after a punchy inflation reading. According to the Australian Bureau of Statistics, the Consumer Price Index gained 4.6% over the year through March. Automotive fuel prices jumped 32.8% just in the month. The trimmed mean, a measure that leaves out the biggest outliers, sat at 3.3%—no change from before.
CBA economists aren’t backing off: underlying price pressures are still too strong for the RBA to let up, despite fuel lifting the headline figure. “The inflation problem has not yet been solved,” said senior economist Trent Saunders. CBA’s head of Australian economics, Belinda Allen, described the May call as “another line ball decision.” CommBank
Still, locking in a fixed rate isn’t a straightforward victory. Australia’s MoneySmart notes fixed loans can help with budgeting, but variable options leave room for extra repayments, switching, and flexibility; anyone fixing now could miss out if rates drop while they’re locked in.
That jump in searches hits right at the center of CBA’s business. Australia’s top lender posted a record A$5.45 billion in first-half cash earnings back in February. Home loan volumes climbed 3.7%, and CBA held onto a 25.4% slice of the home-lending market. But fiercer competition trimmed its net interest margin by four basis points, down to 2.04%.
Search activity doesn’t equal actual loan signings. Some borrowers could just be shopping around rather than committing. The next real indicator: how lenders adjust pricing after the RBA decision.
Near term, risk swings both directions. Inflation fanning out past petrol—into services, rents, building costs—could force the RBA to lift rates above CBA’s forecast. But if the oil shock eases and demand cools, borrowers locking in today might end up footing the bill for certainty right when they least needed it.
CBA put the decision down to household budgeting, not a push for more sales, arguing borrowers are weighing up certainty versus flexibility. The bank’s data highlight a recurring Australian dilemma: with rates up, mortgage holders are being forced to make a choice ahead of any central bank action.
