Inflation eases, but remains elevated, keeping rate pressure in focus
Good news doesn’t come around often when we talk about the cost of living. The latest inflation figures provide some relief, but they don’t mean inflation is under control just yet.
New data from the Australian Bureau of Statistics shows inflation eased in the June quarter, with headline inflation moderating. Underlying inflation also came in below earlier expectations, but remains elevated and above the Reserve Bank of Australia’s 2–3% target range.
That distinction matters. For Australians managing a mortgage, rent and everyday expenses, cost-of-living pressure hasn’t disappeared, and the Reserve Bank’s own message this week was firm: inflation is still too high, is expected to stay elevated for some time, and the Board has kept the door open to further rate rises if upside risks materialise.
What’s Actually Happening
Put simply, prices are still rising, just not as fast as before. Housing costs, particularly electricity and new dwelling prices, remain the biggest driver of inflation. June CPI was helped by lower fuel costs, but the RBA is still watching global oil and energy-price risks.
For everyday households, this means budgets remain stretched. Housing prices are falling in some capital cities and new housing loan commitments have declined, a sign the property market is still adjusting to higher borrowing costs, rather than stabilising.
RBA Holds Cash Rate at 4.35% Amid Persistent Inflation
The Reserve Bank added its own read on the numbers this week. In its 11 August 2026 monetary policy statement, the Board left the cash rate target unchanged at 4.35 per cent, holding steady after three increases earlier in the year. The RBA noted that trimmed mean inflation remains elevated and is little changed from the previous quarter, and it doesn’t expect inflation to return to the midpoint of its target range until late 2027. The Board flagged it would keep raising rates further if upside risks to inflation, including global oil prices, materialise.
For borrowers, the takeaway is simple: rates are on hold for now, but the RBA hasn’t ruled out further hikes if inflation doesn’t keep easing. That makes it even more worthwhile to lock in a proper review of your borrowing position rather than wait and see.
What This Means for You
If you’re weighing up your next move, here’s where the opportunity sits:
- First-home buyers may find affordability planning a little easier as conditions stabilise.
- Existing borrowers could benefit from reviewing their loan, especially if there’s a refinancing opportunity worth exploring.
- Property buyers may want to revisit their borrowing capacity now that the outlook is shifting.
- Everyone benefits from a proper budgeting strategy, regardless of which way rates move next.
Ready to Make Sense of It All?
Inflation news can feel a bit abstract until you sit down and work out what it actually means for your situation. That’s where we come in.
For tailored advice on your borrowing power, refinancing options, or buying strategy, get in touch with Safe Haven Finance. Call us on +61 433 564 936 or book a free consultation, and let’s work out your next step together.
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Sources: Australian Bureau of Statistics; Reserve Bank of Australia, Monetary Policy Decision, 11 August 2026.
