Homeowner relief will continue for not one, but two, further months after the Reserve Bank of Australia (RBA)'s decided to leave the 4.35% cash rate unchanged today.

The third consecutive pause and 12-year cash rate high will continue until May, rather than April, as part of the newly-styled central bank's plan to hold eight, rather than 11, cash rate announcements every year.

However, the RBA remains old-school in its cautionary outlook and repeated well-worn phrases that inflation is still too high.

RBA Governor Michele Bullock repeated this warning today but also advised that inflation was at least moderating with the headline monthly CPI indicator remaining steady at 3.4% over the year to January, according to Australian Bureau of Statistics data.

Ms Bullock also added - again - that economic outlook uncertainties remain high while - again - the RBA Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.

However, in a promising point for homeowners, today's release did not include the similarly well-worn words that "a further increase in interest rates cannot be ruled out".

"Where we are now is where we need to be"

At the media conference with Ms Bullock after the RBA announcement, the governor confirmed that overall economic demand - including that of real estate - still exceeds supply.

Thus, the need for the central bank to continue to navigate its now rather infamous "narrow path".

Ms Bullock told reporters this afternoon that while unemployment tightness was easing, figures were still much higher than that of pre-pandemic Australia.

She added that real-time disposable income was also still declining and consumption was weak; however, productivity has picked up in the last few quarters which is promising.

Industry experts are already predicting the latest employment figures to be released on Thursday, March 21 could result in cash rate cuts in August or September - the first since April 2020 and the start of the pandemic.

However, as in the February media conference, Ms Bullock said today that the RBA was not ruling out either cash rate rises or cuts in the future.

"For a rate cut to occur, we would want to be much more confident that the inflation rate has come back into the target band (of 2-3%) and at the moment, we're not seeing that," she said.

No surprise about continued respite

Today's RBA decision came as no surprise to industry experts including the Big Four Banks, who had predicted another paused outcome following last month's continued respite.

Westpac and Commonwealth Bank predict rate cuts will begin in September, with NAB and ANZ forecasting a November or December start for the first clips.

While also unsurprised by today's cash rate announcement, CoreLogic research director, Tim Lawless said the timing of a rate cut remains uncertain and dependent on inflation outcomes.

However, he believes the continued respite and the Big Four Bank rate cut predictions will nevertheless boost consumer confidence and lift real estate sales activity, with recent history highlighting a close relationship between the two.

"Following the 6.2% rise in the February consumer sentiment reading from Westpac and the Melbourne Institute, a further lift in confidence could be accompanied by a rise in home purchasing," Mr Lawless said.

Mr Lawless warned that while headline inflation - which is the RBA's number one focus - has decreased faster than expected, services inflation remains
"stubbornly high".

"This reflects tight labour market conditions but also ongoing growth in services costs," he said.

Mr Lawless agreed with Ms Bullock that there is an imbalance between supply and demand despite housing values resisting the pressure of high interest rates.

"This situation looks entrenched as barriers to new housing supply remain high," he said.

Mr Lawless added that CoreLogic data for January and February has already recorded a national acceleration in the pace of value growth, which could reflect renewed optimism amid a peak in the rate hiking cycle and progress towards the inflation target.

"CoreLogic's daily home value index data is pointing towards further growth in housing values ... and we have also seen auction clearance rates bounce higher through the year-to-date, rising to above average levels in most cities," he said.

The RBA’s next monthly cash rate announcement will be on Tuesday, May 7 at 2.30pm AEDT. This will be followed by announcements in June, August, September, November and December.