The Reserve Bank of Australia (RBA) has decided to provide reprieve to Australian homeowners as it left the official cash rate untouched at 4.5 percent this July, in a move that is largely anticipated by most economists due to concerns on major inflation data that would be known by the end of the month.

After its monthly board meeting on Tuesday, RBA Governor Glenn Stevens said in a brief statement that 'the current setting of monetary policy is resulting in interest rates to borrowers around their average levels of the past decade."

Mr Steven said that the RBA board believes that the current setting of monetary policy is appropriate at this time, as they wait for "further information about international and local conditions for demand and prices."

He said that the consumer price index would likely reach beyond three percent in the near term, which is above the RBA's ideal target band of two to three percent and reflective of the impact in raised tobacco taxes earlier this year and substantial spikes in utilities cost.

Mr Stevens also pointed to the apparent volatility in financial markets as concerns over the worsening European sovereign debt is heightened, stressing that "some tightness in funding markets is evident, though not on the scale seen in late 2008."

The RBA governor said that while the situation in Europe has seen improvements lately, with some key countries' output showing positive results, "prospects for next year are more uncertain given the budgetary constraints governments face and the pressure on euro area banks."

On the side, economists have been harping on critical inflation data scheduled to be released later this month and they were in agreement that the information could prompt the RBA to lift the interest rate by August, unless of course a much problematic global economic conditions is ushered in.

The RBA has already raised the cash rate six times over the past eight months, starting off in October, which spurred the monthly home loan repayments to jump by more than $300, on an average of $300,000 mortgage.