2 February — Nurse Anita Cobby is abducted, robbed, raped and murdered by John Travers, Michael Murdoch, and Leslie, Gary and Michael Murphy at ProspectinSydney (all five men are sentenced to life imprisonment without parole, June 1987).
7 February — Following Lindy Chamberlain's identification of a baby's jacket found near Uluru as being similar to the one worn by her baby Azaria, her case takes a new turn.
18 March — Prime Minister Bob Hawke commits the Federal Government not to raise home interest lending rates above 13.5%, despite continued pressure from the banks.
27 March — The Russell Street bombing takes place at the headquarters of Victoria Police in Melbourne. A police constable, Angela Taylor, is killed.
2 April — Prime Minister Bob Hawke breaks an election promise by lifting the ceiling on home interest rates, following the banks' promise of an extra $6 million for home loans.
11 April — The Arbitration Commission finds that the Builders' Labourers Federation was guilty of serious industrial misconduct and the union is deregistered.
14 April — A second trial of Mr. Justice Lionel Murphy begins in Sydney, and lasts for two weeks, with the jury eventually acquitting him.
14 May — Responding to the release of dismal current account deficit figures, Federal Treasurer Paul Keating makes his infamous off-the-cuff warning about Australia becoming a "banana republic".
16 July — An explosion at Moura No. 4 mine in Moura, Queensland kills 12 people.
25 July — An unusual cold dry change sweeps through south-eastern Australia, causing temperatures to plummet and bringing 8 centimetres (3.15 in) of snowtoHobart, isolating the city until midday. Canberra also receives snow during the early afternoon with reports of snow and sleet also occurring in the suburbs of Melbourne and Sydney.
6 August — A low pressure system moving from South Australia and redeveloping off the New South Wales coast dumps a record 327.6 millimetres (12.90 in) of rain in a day on Sydney. Resulting floods kill six people.
19 August – Sydney schoolgirl Samantha Knight abducted and murdered by Michael Guider.[2]
21 August — Labor Caucus votes 74:42 to resume sales of uranium to France.
23 September — Federal Opposition Leader John Howard is suspended from the Australian House of Representatives for 24 hours after attacking Federal Treasurer Paul Keating for huge travel expenses incurred by claiming Sydney as his principal place of residence.[3]
27 November — Federal Treasurer Paul Keating is found liable to a fine of $4,000 for not lodging his tax return for 1985 and his 1986 return being overdue.
26 December — Tuning into rural disenchantment, Queensland Premier Sir Joh Bjelke-Petersen contemplates the notion of entering the federal political scene.
30 April — Crocodile Dundee is released in Australia. The film will go on to become a worldwide smash hit, becoming the highest grossing Australian until 2015
Minor premiers Parramatta Eels defeat the Canterbury Bulldogs 4–2 in the lowest scoring grand final in history to win the 79th NSWRL premiership. It is the Eels' most recent premiership win. The Illawarra Steelers finish in last position, claiming their second straight wooden spoon.
