Reserve bank leaves interest rate on hold at 4.35% with borrowers left waiting for relief

Australia’s borrowers have been given another reprieve, with the Reserve Bank leaving its key interest rate on hold for a fifth consecutive board meeting but retaining the option of a further rate hike if needed. As expected by economists, the RBA held its cash rate unchanged at its 12-year high of 4.35% at the conclusion of a two-day meeting that wrapped up on Tuesday afternoon. The bank’s communique, though, warned that “inflation remains above target and is proving persistent”.

“Inflation is easing but has been doing so more slowly than previously expected and it remains high,” it said in a statement.

“The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain and the Board is not ruling anything in or out,” it said, repeating a mantra that leaves it the option of another rate rise if needed.Mortgage holders on a typical $600,000 loan are paying back about $1,450 more each month since the central bank started its cycle of 13 rate rises in May 2022, according to RateCity.

— Srini Golagani