Home owners may have been given some hope for mortgage relief next month after inflation eased again in July.
The consumer price index (CPI), which measures inflation in the Australian economy, rose 3.5 per cent in July, according to the latest figures released by the Australian Bureau of Statistics.
That is down from 3.8 per cent in June, but remains above the Reserve Bank of Australia's (RBA) target of between 2 and 3 per cent.
Housing remained the largest contributor to inflation, followed by food and non-alcoholic beverages, and recreation and culture.
"Housing rose by 5.0 per cent in the 12 months to July due to rising costs for new dwellings," Rachael McCririck, ABS head of price statistics, said.
"New dwellings prices rose 5.7 per cent in the 12 months to July as builders passed on higher costs for materials and labour."
Despite the easing inflation figures, a hold on the cash rate is not certain.
Ahead of the figures' release, experts had predicted the CPI would come down as far as 3.3 per cent.
Trimmed mean inflation, the Reserve Bank's preferred method for judging inflation, remained at 3.6 per cent, unchanged in the past 12 months.
Minutes from the previous meeting of the RBA board, which were released on Tuesday, August 25, showed board members had considered raising the cash rate by 25 basis points to prevent the risk of inflation becoming further entrenched.
Despite this, the board had unanimously decided to keep the rate on hold at 4.35 per cent for the second time in row.
At the time, governor Michele Bullock said the decision to keep the cash rate on hold was intended to give the RBA time to watch and see if three hikes at the start of the year had been effective in slowing growth in the economy.
She remained clear, however, that the possibility of another hike was still on the table if inflation remained above target.
The RBA board will next meet on Thursday, September 29.
