Sydney, February 27, 2026, 17:03 AEDT — After-hours
- Westpac finished the session in the red, while the wider market managed to hit yet another record high.
- Big banks are moving once more in step with interest-rate expectations.
- Traders are now looking ahead to Australia’s GDP release next week, with the RBA’s policy call lined up for mid-March.
Westpac Banking Corp (WBC.AX) finished the session at A$42.54, slipping 0.4%. Shares moved within a range of A$43.08 to A$42.44. Roughly 7.2 million shares were traded. 1
The S&P/ASX 200 finished 0.25% higher at 9,198.60, setting another record, though investors remained edgy over how interest rates will settle and for how long. “The rotation from tech to non-tech continues,” AMP’s Shane Oliver noted. The blog pointed to Australia’s fourth-quarter GDP, due March 4, as the next key domestic figure. Meanwhile, APRA data showed household deposits at ADIs climbed to an all-time high of A$1.72 trillion in January—a figure banks eye closely when funding competition heats up. 2
This week’s rate debate intensified after January’s inflation figure stuck at 3.8%. “The monthly trimmed mean showed still-strong underlying inflation,” said Paul Bloxham, HSBC’s chief economist for Australia and New Zealand. The trimmed mean, which discounts the most extreme price changes, is used to track core price pressures. 3
Reserve Bank of Australia Governor Michele Bullock called for patience, noting that policy decisions have gotten trickier now that the economy is “close to balance” and inflation remains elevated but isn’t picking up speed. Markets responded to the data by trimming the chances of a May hike, according to Reuters. 4
Currency markets are sticking to the same pattern. The Australian dollar has climbed more than 6% since the start of the year, outpacing all other G10 currencies, helped by expectations that the RBA remains hawkish and may stick with higher rates, according to Reuters. “It’s conceivable the Aussie could tack on another one or two U.S. cents,” said Carol Kong, currency strategist at Commonwealth Bank of Australia. She only sees room for one more 25-basis-point rate hike this year—a basis point equals 0.01 percentage point. 5
Offshore sentiment wobbled. Reuters pointed to renewed nerves over lofty valuations in AI-linked tech names and ongoing Middle East strains. “AI and geopolitics remained front and centre for financial markets,” Westpac Group senior economist Mantas Vanagas wrote. 6
Westpac’s near-term setup still looks like a play on rates. Higher rates might boost net interest margins—the difference between what the bank makes on loans and pays out on deposits. On the flip side, pricier borrowing tends to dampen credit appetite and strains riskier segments of the loan book.
Investors are watching the basics—deposits, pricing, and if banks need to shell out more to hang on to funding while households move cash. That reserve of savings helps, until a scramble for better rates pushes everyone into a price fight.
The setup doesn’t look sturdy. A weak GDP number or a sharp global risk-off move can slam bank stocks fast, stirring up fears of sluggish growth and bigger loan losses.
Focus now turns to the RBA’s March 16–17 meeting. The decision lands at 2:30 p.m. on March 17, followed by a media conference an hour later at 3:30 p.m. 7
