Inflation Eases, Mortgage Holders Breathe Easier

The Australian Bureau of Statistics has reported a drop in inflation to 3.8%, giving mortgage holders some temporary relief.

This decrease, down from 3.9% in May, may influence the Reserve Bank of Australia's decision on whether to keep the cash rate at its current level of 4.35%. The RBA will convene on August 11 to make this determination.

LJ Hooker group head of research Mathew Tiller said this development provides the RBA 'with a little bit of breathing room' if they decide to hold the cash rate.

However, underlying inflation remains steady at 3.6%, above the RBA's target range of between 2 and 3%. RBA governor Michele Bullock has cautioned that further easing in demand may be necessary to bring inflation back down.