RBA Minutes from the July 4th meeting stated that the Board considered holding rates steady or hiking by 25bps and there was a strong case for both but Board judged arguments for holding steady were stronger

Says:

• Board agreed some further tightening may be required and would reconsider at the August meeting.
• Current stance of monetary policy was clearly restrictive and would become more so.
• Board discussed risks economy and consumption could slow more.
• Board noted a squeeze on household finances and the risk unemployment could rise more than needed, while the inverted yield curve pointed to tighter conditions and slowing growth.
• Risks with waiting too long for inflation to return to the target.
• Labour market is very tight and weak productivity is adding to labour costs.
• Inflation is proving sticky in other countries.
• While domestic inflation has eased, service inflation is still high along with rents, energy and food.
• Economy had slowed considerably and Q2 GDP growth is seen around 0.2% Q/Q,
• Consumer spending is seen weak in Q2 and rebound in housing market will support consumption.