‘Dodged a bullet’: inflation eases to 3.8%, reducing chances of interest rate rise for Australia’s mortgage holders

Australia’s June inflation data came in softer than expected, with headline CPI easing to 3.8% from 4.0% and the RBA’s preferred trimmed-mean measure cooling more than forecast on a quarterly basis. The print reduces the immediate risk of another Reserve Bank of Australia rate hike at the 11 August meeting, offering relief to mortgage holders and supporting sentiment across Australian risk assets. However, inflation remains above target and homebuilding and services prices still show persistent pressure, meaning the policy outlook is not fully resolved. Lower fuel prices helped pull the headline figure down, but those benefits may fade as geopolitical tensions affect oil markets. Overall, the report shifts expectations toward the RBA holding rates steady rather than tightening further in the near term.