The ASX 200 is edging up, as banks raise forecasts of how far the Reserve Bank will hike the cash rate.

At 1:45pm AEDT, the benchmark was up 0.5 per cent, helped by mining and energy stocks.

Rare earths company Lynas had the biggest gain with a boost of 7 per cent.

Meanwhile, another company that digs copper, Sandfire, is also up 6.7 per cent.

The benchmark is overall at a 20-day high.

Financial stocks were the main drag on the market, with the sub-index down 0.4 per cent.

ANZ's stock was down almost 4 per cent, despite the bank posting yearly results showing its cash profit was up 5 per cent to $6.5 billion.

It has come as the cash rate has been hiked at the fastest rate in decades by the Reserve Bank, delivering higher interest rates to lenders like the major bank.

A day after official inflation data was released in Australia showing prices are still soaring, banks are now forecasting that the cash rate will go even higher.

The RBA has been hiking the cash rate, which banks use as a guide for interest rates, in part to tackle the soaring inflation rate.

Westpac said this morning in a briefing note that it now expected the RBA board to hike the cash rate by 0.5 per cent when it next meets on Tuesday.

And the bank expects the cash rate to get up to 3.85 per cent by March.

That is up from its previous forecast of 3.6 per cent.

"The September quarter inflation report has come as such a major surprise that we think the Reserve Bank Board will decide to raise the cash rate by 50bps at the next Board meeting on November 1," Westpac wrote.

This would mean a bumper rate hike for borrowers on Melbourne Cup Day.

CBA also upgraded its forecast for the peak RBA cash rate, after the hotter-than-expected inflation data.

It now expects it to get to 3.1 per cent in December.

Previously, CBA was expecting 2.85 per cent by November. But it now expects an additional 25 basis point rate hike in December.

Barranjoey's chief economist Jo Masters is also tipping a higher than previously expected rate hike of 3.6 per cent, with the 50 basis points hike expected on Tuesday.

Meanwhile, the ASX 200 is gaining despite falters on Wall Street.

The Dow Jones was flat, while the S&P 500 and Nasdaq lost ground overnight with the tech-heavy sector down 2 per cent.

Shares of Facebook owner Meta dived 17 per cent as its fourth-quarter forecast failed to please investors.