RBA Interest Rates Decision Made Easier by Surprise Drop in Inflation Numbers

A surprise drop in inflation numbers has given Reserve Bank of Australia (RBA) Governor Michele Bullock some breathing room to keep interest rates steady at 4.35 per cent.

The Australian Bureau of Statistics (ABS) revealed the June quarter trimmed mean consumer price index rose just 0.8 per cent quarter-on-quarter, which is below market expectations of a 0.9 per cent jump.

This cooler-than-expected inflation rate means homeowners will not see their mortgage repayments increase as much as previously feared.

According to Canstar modelling, an August cash rate hike would have added $92 a month to a $600,000 home loan, taking annual repayment increases in 2026 alone to $4,368. However, with the current inflation rate, this is unlikely to happen.