The Reserve Bank of Australia (RBA) has kept interest rates on hold despite stickier-than-expected inflation and the ever-growing spectre of rising house prices.
Meeting today under its new two-day schedule, the RBA board discussed hiking rates once again, but eventually decided to keep the official cash rate target on hold at the 12-year high of 4.35 per cent.
"The board did discuss the option of raising interest rates. It discussed the option of keeping interest rates where they were," RBA Governor Michele Bullock said in her press conference following the meeting.
"On balance, the board felt that, at the moment, staying where they are was appropriate. We think that policy is currently restrictive."
She said that the board doesn't expect having to hike rates again, but that it's open to the possibility should inflation continue to stay higher than the bank would like.
"The data towards the end of last year and early this year led everyone to think, 'oh, it's ok now'," she said.
"We've always felt that it was a bit too soon to declare victory, and I think the numbers in recent weeks have demonstrated that...
"We don't think we necessarily have to tighten again, but we can't rule it out. If we have to, we will. If we really think that inflation is going to be persistent and significantly above our forecasts, we will tighten again."
She also added that, were it not for last November's rate rise, the board may have had to hike rates today.
Financial markets had largely expected no change in the cash rate, with economists split over when - not if - the central bank would move to cut.
In her monetary statement, Bullock said it was necessary to see more data in the current economic climate before delivering relief for borrowers.
"Recent information indicates that inflation continues to moderate, but is declining more slowly than expected," Bullock said.
"The Board expects that it will be some time yet before inflation is sustainably in the target range and will remain vigilant to upside risks.
"The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain and the Board is not ruling anything in or out.
"The Board will rely upon the data and the evolving assessment of risks. In doing so, it will continue to pay close attention to developments in the global economy, trends in domestic demand, and the outlook for inflation and the labour market.
"The Board remains resolute in its determination to return inflation to target."
CreditorWatch's Chief Economist Anneke Thompson said it would be job figures - and not inflation - that would force the RBA's hand.
"Even moderate softening of the employment market will likely mean that we are at the peak of this tightening cycle, as smaller businesses and many household businesses will now be in precarious financial positions given the high cost of debt," Thompson said.
"The RBA is unlikely to risk further damage to sectors of the economy that are least able to cope with it."
Steve Mickenbecker, Canstar's finance expert, said borrowers desperate for a rate cut should not hold out for a definitive call from the RBA.
"If borrowers opt to wait for the Reserve Bank to cut the cash rate and lenders to follow suit, they could be facing thousands of dollars in additional repayments and interest," explains Steve Mickenbecker, Canstar's finance expert.
"However, seizing the opportunity to switch now could result in considerable savings, especially with the first forecasted rate cut in November.
"By refinancing now borrowers can lock away savings over the next six months or so if the cash rate cut comes in line with expectations of the big four banks in November, and then double dip when rates eventually fall. It's hard to flaw this approach."
The suburb costing renters over $1300 a week
Finder analysis shows the minimum household income required to afford the average Australian house price has risen to $171,223.
That rises if a person wishes to buy in Sydney (minimum household income of $263,195), or Canberra (minimum household income of $185,599).
"Many Australians dream of owning their own home, but it's becoming increasingly difficult to get your foot in the door," Cooke said.
"Those living in major capital cities now require a substantial household income just to be able to comfortably service the average mortgage, without even considering saving for a deposit."
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