As expected, no rate rise from the Reserve Bank yesterday and indeed, rates could be on hold for an indeterminate time if international worries about economic growth and financial stability continue.

Governor Glenn Stevens said the board of the central bank left its cash rate steady on 4.5%, "pending further information about international and local conditions for demand and prices".

Until then, the current levels of rates is "appropriate" according to the bank.

Dropped was any reference to the "near term" which was in the final paragraph of the June board meeting statement.

The final paragraph of yesterday's statement was far more direct and for the first time the board said it will be watching international and local data on prices and demand before deciding on the next rate rise.

As will central banks in the UK and the eurozone later this week at rate policy meetings of their own.

And, the acknowledgement in the post-meeting statement that inflation will rise above the 3% top of the target range, seems to indicate that the bank will not move to lift rates if, as expected on July 28, the June quarter Consumer Price Index reveals a higher than comfortable increase in price pressures.

The statement says, "Underlying inflation appears likely to be in the upper half of the target zone over the next year.

"The rate of CPI increase is likely to be a little above 3 per cent in the near term, due to the effects of increases in tobacco taxes announced earlier in the year and significant increases in prices for utilities."

That's a recognition of the impact of changes in the federal tax on cigarettes and rises in state power, water and sewerage charges now being allowed by regulating bodies.

But, judging from the statement released yesterday, before lifting rates again, the bank will spend some time looking long and hard at what is happening in economies offshore, as well as at local inflation.

"The global economy has continued to expand over recent months, consistent with a trend pace of growth," the July statement started yesterday.

"The expansion remains uneven, with the major advanced countries recording only modest growth overall, but growth in Asia and Latin America, to date, very strong.

"There are indications that growth in China is now starting to moderate to a more sustainable rate. In Europe, while output in some key countries has been improving recently, prospects for next year are more uncertain given the budgetary constraints governments face and the pressure on euro area banks. US growth has looked stronger in the first half of 2010 but the pace of labour market improvement is slow.

"Caution in financial markets has been evident in the past couple of months, driven principally by concerns about European sovereigns and banks but also by some uncertainty about the pace of future global growth.

"Financial prices have been more volatile and equity prices and government bond yields in major countries have declined. Some tightness in funding markets is evident, though not on the scale seen in late 2008.

"Commodity prices are off their peaks but those most important for Australia remain at very high levels, and the terms of trade are approaching their peak of two years ago.

"With the high level of the terms of trade expected to add to incomes and demand, output growth in Australia over the year ahead is likely to be about trend, even though the effects of earlier expansionary policy measures will be diminishing.

"Consumption spending is recording a modest increase at present, with households displaying a degree of caution, but most indicators suggest business investment will increase over the coming year. Business credit appears to have stabilised, though credit conditions for some sectors remain difficult.

"Credit outstanding for housing has continued to expand at a solid pace, but dwelling prices are rising more slowly than earlier in the year.

"The labour market has continued to firm gradually, and after the significant decline last year, growth in wages has picked up a little, as had been expected.

"The current setting of monetary policy is resulting in interest rates to borrowers around their average levels of the past decade."

Commentators this morning saw 'rate rise' in election campaign and their reports reflected that.

But the reality is that the outlook is now more uncertain than it has been probably for a year or more.

So international news will have as great an influence on the bank as will the flow of data from the CPI, retail sales, housing and the like.