Rate cut hopes fade as RBA sounds the alarm on inflation

Traders have dialled back their bets for an interest rate cut this year after the Reserve Bank considered raising borrowing costs at its June meeting given inflation is cooling at a slower pace than forecast.

The central bank, as expected, kept the cash rate at a 12-year peak of 4.35 per cent for the fifth consecutive meeting on Tuesday and repeated that it wasn’t ruling anything in or out with inflation remaining persistently above target.