Australian policymakers judged it appropriate to leave the key interest rate unchanged at a record low for the fourth straight meeting.
The Reserve Bank of Australia Policy Board, governed by Glenn Stevens, decided to leave the cash rate at 2.00 percent. The bank had lowered the rates by 25 basis points each in February and May.
"Further information on economic and financial conditions to be received over the period ahead will inform the Board's ongoing assessment of the outlook and hence whether the current stance of policy will most effectively foster sustainable growth and inflation consistent with the target," RBA said in a statement.
While there is no denying that the chances of more rate cuts are fading, a further worsening in the economic outlook and a weakening in underlying inflation could still prompt the RBA to reduce rates below 2 percent, Paul Dales, chief Australia & NZ Economist at Capital Economics, said.
The bank said most of the available information suggests that moderate expansion in the economy continues.
The Australian Bureau of Statistics is set to publish GDP data on Wednesday. The economy is expected to grow at a slower pace of 0.4 percent in the second quarter after expanding 0.9 percent a quarter ago.
The bank said the Australian economy is likely to be operating with a degree of spare capacity with domestic inflationary pressures contained.
The RBA observed that the global economy is expanding at a moderate pace, with some further softening in conditions in China and east Asia of late.
Inflation is forecast to remain consistent with the target over the next one to two years, even with a lower exchange rate, the bank reiterated.
The bank also noted that the Australian dollar is adjusting to the significant declines in key commodity prices.
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