The decade-long drought that has been punishing Australian farmlands apparently took a break starting last year, leading to record fruit and vegetable harvests as of the first quarter of 2012 and market price retreats of about 25 percent, reports said.

Other market indicators, according to Bloomberg, also showed that consumer price levels should hover within the two and three percent bandwidth set by the Reserve Bank of Australia (RBA) as fairly ideal over the next decade, further making the case for a likely cash rate cut in May.

The Commonwealth Bank of Australia (CBA) has estimated that prices merely jumped by 2.1 percent over the past 12 months, leaving the core inflation levels at around 2.4 percent.

"It looks like there's quite a big fall in fruit and vegetable prices coming through in the first quarter ... and these numbers don't look like they'll be standing in the way of a rate cut," CBA chief economist Michael Blythe told Bloomberg on Friday.

The central bank has indicated on its April board meeting minutes that it was prepared to unleash a more aggressive monetary intervention policy come next month if the overall condition warrants for such actions.

"If slower growth in demand could be expected to result in a more moderate inflation outcome, then a case could be made for a further easing of monetary policy," the RBA said in the board meeting minutes.

And even prior to the official consumer price index (CPI) release next week, analysts believe the RBA will slash the current 4.25 percent interest rate, which Bloomberg said was among the highest in the developed world.

RBA governor Glenn Stevens will opt for a rate reduction in May because crop production in the country has already reached bumper levels, with the agricultural sector reporting recently that avocado, apple and mango stocks have reached record levels, which experts said were last seen some 10 years ago.

Fresh State Ltd chief executive John Roach confirmed to Bloomberg that a supply glut in the agricultural industry was already in effect and prices of basic produces have gone down by as much as 40 percent in the current quarter.

"Just about everything has been in oversupply ... The price can only do one thing in that situation: it crashes," Roach said.

The direct effect, according to traders, is the gradual onset of weakening demands, which could mean, analysts added, that discretionary spending has gone.

And to prove that the RBA has a strong case to slash the cash rate, aside from the growing calls by many sectors for the bank to do so, traders in Brisbane reported that streams that were filled up by heavy rains last year have yet to signal signs of drying up anytime soon.

That should mean more production capability for farmers in the area, with one producer affirming to Bloomberg that "our valley's got abundant supply of water, which means that there's an oversupply of produce."