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TOKYO, Japan, February 4, 2026 – Honda Motor Co., Ltd. (Honda) today announced plans to co-develop system-on-a-chip (SoC) for its software-defined vehicles (SDVs), with Mythic, a Texas, U.S.-based technology company.

Honda has invested in Mythic, which has original technologies and a proven track record in this field of technologies, to establish technologies to enhance the computing performance and energy efficiency of AI to be used for automated driving and other features of its SDVs. Today, Honda announced plans for Honda R&D Co., Ltd., the R&D subsidiary of Honda, to co-develop automobile SoC with Mythic.

In order to continue offering the “joy and freedom of mobility” in a sustainable manner, Honda has been placing the highest priority on addressing environmental and safety challenges. In particular, enhanced application of intelligent technology will be the key to addressing safety issues. This makes the advancement of high-performance SoC for SDVs essential; therefore, Honda is conducting research and development of digital computing^*1 technologies.

Looking ahead, as AI technologies continue to advance, further innovation is required in technologies to enhance computing performance and energy efficiency. With a view to building computing infrastructures which will contribute to the application of next-generation intelligent technologies, Honda is actively exploring neuromorphic*² SoC technology, that draws inspiration from how the human brain works.

Mythic is a startup company with strong expertise in semiconductor technologies that leverage analog computing, which achieves high-efficiency AI processing with low power consumption. For the development of neuromorphic SoC, Mythic has original analog compute-in-memory (CiM)^*3 technology and a proven track record in software implementation using tools such as software development kit (SDK)^*4. With its analog CiM, Mythic is working to minimize data movement for computation and achieve both high computing performance and energy efficiency.

Honda has invested in Mythic to pay close attention to original technologies of Mythic and respond flexibly to future changes in the technological environment and societal trends. Moreover, Honda R&D will leverage its expertise and technologies amassed through the design of its original AI models and the research and development of electronic control units and integrate the original technology of Mythic into AI computing functions that consist of SoC. With that, Honda R&D will further accelerate the research and development of SoC for next-generation SDVs, to further enhance computing performance and energy efficiency.

When the Reserve Bank of Australia (RBA) board voted unanimously to lift the cash rate to 3.85% on Tuesday, the decision was driven by one overriding concern. It wants to stop the rising cost of living from becoming entrenched.

For some, like self-funded retirees, the rate rise was good news. Higher interest means their savings and term deposits will earn more. But for many others, including first home buyers who might have stretched themselves just to get a foot into the housing market, it was a very bad day.

RBA Governor Michele Bullock acknowledged that, saying:

I know this is not the news that Australians with mortgages want to hear, but it is the right thing for the economy.

She warned the alternative – letting inflation keep rising – would be even harder for more Australians.

So what’s the psychology behind the RBA raising rates now and leaving the door open to further hikes if needed? And what does the central bank hope Australians will do in response?

The price squeeze you’re feeling

There’s a striking gap between how the RBA describes the economy and how most Australians experience it.

On paper, things look healthy: unemployment is low, wages are growing.

But as Bullock acknowledged on Tuesday, the daily reality has felt very different.

The price level has gone up 20% to 25% over the last few years, and people see that every time they walk into a supermarket, or they go to the doctor, or whatever – that’s I think what’s hurting people.

That relentless price squeeze is not something you forget, even when the rate of increase starts to slow.

What’s driving inflation up?

The headline consumer price index (CPI) hit 3.8% in the year to December, well above the RBA’s target band of 2–3%. The “trimmed mean” – the underlying measure the RBA watches most closely – rose to 3.3%. Both are too high and moving in the wrong direction.

Bullock singled out three factors contributing to inflation. Each behaves differently and requires a different response.

Housing was the single largest contributor to inflation in December, up 5.5% over the year. That includes rents, which rose 3.9% (or 4.2% stripping out government rent assistance), as well as insurance, utilities, and new construction costs, which rose 3% as builders passed through higher labour and material costs.

There is an irony here. Rising interest rates are intended to cool demand, but they slow housing construction. Limited supply of housing is what’s pushing rents up in the first place.

“Durable goods” are the things we buy to last, such as cars, refrigerators, washing machines, televisions and furniture. Demand for many of those has been higher in the past year.

“Market services” are items such as restaurant meals, taxis, haircuts, gym memberships, medical appointments and holiday travel.

The RBA watches these carefully, because these are services priced by supply and demand in the domestic market. Those prices tend to be “sticky”: once they start rising, they don’t come back down easily.

Wages are also a big part of market services inflation. If the people providing those services are earning more, the cost goes up.

Read more:
RBA raises interest rates as inflation pressures remain high

How rate cuts made shoppers relax

This is where the behavioural psychology gets interesting.

The RBA cut interest rates three times in 2025. Each cut sent a signal, whether intentionally or not: it’s OK to spend a bit more.

And spend we did. CommBank data shows Australians spent A$23.8 billion over the two-week Black Friday period, up 4.6% on the year before.

It’s a cautionary tale about “rational expectations”. Each rate cut potentially fuelled the belief that more would follow.

If people feel like they can afford to spend, then they spend. Businesses, sensing demand, may raise their prices to match. That’s exactly the self-fulfilling dynamic central banks worry about.

Read more:
Here’s what Black Friday sales shopping does to your brain

The 3 ways the RBA hopes we’ll react

When prices go up, as they have been, workers ask for bigger wage rises to keep up. To pay higher wages, businesses lift prices to protect their profit margins. Together, that can create a “wage-price spiral” that becomes very hard to break.

The RBA will be hoping Australians respond to this rate rise in three ways:

RBA Governor Michele Bullock described raising interest rates as “a very blunt instrument” to bring inflation down, and noted setting rates is “not a science. It’s a bit of an art, really […] We’ve just got to respond as best we can.”

The RBA can’t undo the price rises that have already happened. It can only try to slow down further increases.