At its July meeting, the Reserve Bank of Australia (RBA) opted to leave the official cash rate unchanged at 3.85%, despite broad expectations among economists and financial markets for a 0.25% cut.

The decision reflects the RBA’s cautious optimism that inflation is continuing to moderate. Trimmed mean inflation for the March quarter sat at 2.9%, and headline inflation has fallen significantly from its 2022 peak. However, with recent data coming in slightly stronger than anticipated, the board chose to hold steady, preferring to wait for further confirmation that inflation is on a sustainable path toward its 2.5% target.

In its official statement, the RBA noted:

“The Board judged that it could wait for a little more information to confirm that inflation remains on track to reach 2.5% on a sustainable basis.”

The decision comes after two earlier rate cuts this year, and while the broader economic outlook remains uncertain — particularly given global trade tensions and domestic wage pressures — signs of stabilisation are emerging.

In the property sector, the decision is likely to reinforce growing consumer confidence. With rates on hold and inflation cooling, borrowing capacity is gradually improving and activity is picking up, particularly among owner-occupiers.

Locally, areas like Helensburgh, Thirroul and the northern Illawarra have seen steady interest in recent months, especially for well-located homes and lifestyle-based commercial opportunities.

As always, the RBA will continue to assess economic data closely in the months ahead. Its next move will depend on inflation trends, household spending, labour market conditions, and the evolving global economic landscape.