Today's decision was widely expected after a softer than anticipated headline inflation figure of 4.1% was released last week.

In its statement, the board retained its hawkish tone.

"While there are encouraging signs, the economic outlook is uncertain and the Board remains highly attentive to inflation risks. The central forecasts are for inflation to return to the target range of 2–3 per cent in 2025, and to the midpoint in 2026.

"Returning inflation to target within a reasonable timeframe remains the Board’s highest priority."

Economists from all the big four banks had tipped no change to the cash rate at today's board meeting, with the ASX RBA rate tracker tipping a 95% chance of no change to the cash rate as of 5 February, and just a 5% chance of an increase.

PropTrack economist Anne Flaherty said last week's inflation figures pretty much cemented today's decision.

"Headline inflation came in at 0.6% over the December quarter, the lowest growth in consumer prices since March 2021 and below the RBA’s forecasts. This continues the trend of declining annual growth in consumer prices and increases the probability that interest rates have hit their peak in the current cycle," she said.

“Today’s decision is good news for the housing market which looks set to benefit from a more stable interest rate environment in 2024. Greater confidence around where interest rates are sitting should support further recovery in buyer and seller confidence.

While interest rates appear to have peaked, two years of high inflation have eroded real wages and, as of September, the household saving to income ratio was sitting at just 1.1%. This is the lowest level seen since December 2007 at the onset of the Global Financial Crisis."

Images via  Reserve Bank of Australia website