Australia’s longest-running specialist newsletter dedicated to federal politics and public policy.
Welcome to this week’s edition of Inside Canberra.
The economic argument returned emphatically to the centre of Australian politics this week.
The Reserve Bank lifted the cash rate by another 25 basis points to 4.60 per cent, its fourth increase of 2026, after concluding that inflation remained too high and that some of the upside risks identified earlier in the year were materialising. The decision was unanimous. The following day, the Australian Bureau of Statistics reported annual headline inflation had climbed from 3.5 per cent to 4.0 per cent in August. Reserve Bank of Australia
Those developments came immediately after the Final Budget Outcome delivered the Government a better-than-forecast fiscal result. The 2025–26 deficit finished at $22.3 billion — $6 billion below the May Budget estimate — after receipts came in $4.6 billion higher and payments $1.4 billion lower than forecast. Gross debt was also $10.6 billion below the May estimate. Treasury Ministers
Beyond economics, the Greens changed leaders after Senator Larissa Waters stepped aside for health reasons, electing Senator David Shoebridge as leader and Senator Steph Hodgins-May as deputy. Canberra’s diplomatic community also welcomed four newly credentialled ambassadors,