The Reserve Bank of Australia held the cash rate at 4.35% for a second straight meeting, in line with market expectations, while keeping a hawkish bias as Gov. Michele Bullock said money markets should not assume the tightening cycle is over and the bank reiterated that the Official Cash Rate target could rise further if inflation remains persistent. Policymakers said monetary restraint is slowing the economy, with rising unemployment and a softer property market helping curb demand; second-quarter inflation undershot forecasts and housing cooled more than the bank had expected. The RBA still sees inflation returning only gradually to the 2% to 3% band, with headline and underlying measures reaching the 2.5% midpoint by early 2028, after a cumulative 75 basis points of rate increases since February failed to restore price growth to that level. Home prices are already down 1.6% from their March peak, ANZ expects a 10.6% peak-to-trough fall in capital-city values in 2026 and 2027, and upcoming CPI, employment and housing data before the September meeting remain central to whether rates rise again.