The Reserve Bank of Australia (RBA) announced a widely expected decision on Tuesday as it kept rates on hold and gave borrowers yet another month to breathe easy over mortgage repayment costs.

Describing the current official cash rate as "appropriate for the time being," the central bank kept rates at 4.5 per cent for the fourth consecutive month.

RBA governor Glenn Stevens said in a statement, "With growth in the near term likely to be close to trend, inflation close to target and with the global outlook remaining somewhat uncertain, the board judged this setting of monetary policy to be appropriate for the time being."

The central bank noted that domestic and asset markets present a "more balanced picture than six months ago", with stabilised business credit and evidence of a greater willingness of lend.

"Through to mid 2011, underlying inflation is likely to be in the top half of the target zone, while CPI inflation will probably be just above 3 per cent for a few quarters due to the impact of the tobacco tax changes."

However, the addition of 'for the time being' in an otherwise echoing monthly statement led some analysts to predict it may resume raising interest rates before long.

Macquarie economist Ben Dinte said ''for the time being'' suggests the RBA is tilting towards another rate rise.

''While we don't expect the next rate change to come in October, they are likely to move before the end of the year,'' he said.

RBA's decision follows official figures that indicated economic growth has not forced an increase in inflation. Local economy expanded 1.2 per cent in the second quarter, almost double the 0.7 per cent pace in the first three months, and the fastest pace in three years. Second-quarter inflation, however, eased to 0.6 per cent, less than the 0.9 per cent in the first quarter, showing prices remain under control.