The Reserve Bank of Australia (RBA) is not expected to keep interest rates unchanged at 4.10% at its latest meeting.
This turned out to miss the expectations of the market which expected the central bank to increase the rate by 25 basis points.
The decision to keep rates unchanged gives more time to assess the impact of the hike so far and the economic outlook.
Inflation in Australia is down but still too high.
Household consumption growth is weak.
Conditions in the labor market remain very tight although slightly reduced.
Efforts to return inflation to the target within a reasonable period of time remain a priority.
The latest data is consistent with inflation expectations to return to the 2-3% target range.
Household consumption surveys are a constant source of uncertainty.
Some further tightening in monetary policy may be necessary.
However, it will depend on evolving data and risk assessments.
The 'Pause' implemented today (Tuesday) missed expectations, but some also predicted that the rate would not change.
The Aussie dollar weakened after the decision as some expected it to raise rates. Even so, the RBA still opens the 'door' to tighten further if necessary.
