On Tuesday, the Reserve Bank of Australia (RBA) announced that there has been no change to the official cash rate, pausing at 4.10% for the fourth straight month.

In her first interest rate decision as RBA governor, Michelle Bullock said that the pause will provide further time for the Reserve Bank board to assess the impact of previous rate rises and the economic outlook.

The Consumer Price Index rose from 4.9 to 5.2 per cent in August, largely driven by an increase in oil prices (which is trading at just below $US90/barrel), but Bullock stated that goods price inflation had eased further since their decision at their last meeting.

Despite a new governor, the board continues to warn that future rate rises may still be necessary to reduce inflation to their 2-3 per cent target range. However, the board noted that the central forecast is for inflation to fall back to these levels in late 2025.

Since the announcement, markets have remained mostly flat as the decision was in line with consensus and markets were quite certain of a pause.