It has been seven weeks since the last cash rate call, with varying opinions on whether the next move would be a hold or a rise. Now, the Reserve Bank of Australia (RBA) has delivered its first decision of FY25.
The central bank announced it will hold the cash rate steady at 4.35 percent for the sixth consecutive monetary policy meeting.
At the end of June, data from the Australian Bureau of Statistics (ABS) showed that the Consumer Price Index (CPI) had risen 4.0 percent in the 12 months to May, up from a 3.6 percent rise in April and 3.5 percent in March. This increase led to speculation that the RBA might feel compelled to enact another hike.
However, many industry experts, including the Real Estate Institute of Australia, noted that the monthly CPI indicator was not as comprehensive as the ABS's quarterly inflation data. They urged calm among mortgage holders and prospective buyers concerned about their ability to service increasing loans.
This cautious approach proved prudent when late last week, ABS data for the June quarter 2024 revealed a quarterly rise of 1 percent and an annual rise of 3.8 percent, easing inflationary fears for the short term.
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