Overview
- The Reserve Bank of Australia left the cash rate at 4.35% in a unanimous decision on Tuesday and published forecasts that see consumer inflation easing to about 3.6% by year‑end and 2.6% by end‑2027.
- The RBA said inflation is likely to remain above its 2–3% target for an extended period, warned that higher oil prices and Middle East tensions pose upside risks, and kept open the option of further increases if those risks materialise.
- India’s Monetary Policy Committee voted unanimously on August 5 to keep the repo rate at 5.25% and described its stance as neutral, pointing to mainly supply‑side inflation pressures and steps taken to support the rupee.
- Markets largely expected both holds and have shifted focus to the central banks’ forecasts, the governors’ press‑conference tone and any board dissent as the main signals for the timing of future moves.
- The policy pauses buy time to monitor weaker housing activity, evolving labour costs and commodity shocks while leaving households with short‑term relief but ongoing risk of higher living costs if inflation proves persistent.