An interest rate cut in the middle of the federal election campaign is looking less likely after the central bank indicated its latest reduction was a line-ball call.
Not that record low rates, against the backdrop of deteriorating inflation, should be worn as a badge of honour by a government in terms of economic management.
CPA Australia boss Alex Malley tells AAP that interest and inflation rates are measures of an economy's health, and "in this case, the pulse is getting weaker".
While new figures on Tuesday indicate a positive response from Australians to the May rate cut, Mr Malley argues the possibility of a further reduction is bad news for investors who rely on income from interest-bearing securities.
Minutes of the central bank board meeting that voted for the first rate cut in a year focused heavily on the most recent consumer price index figures showing the economy had sunk into deflation.
It was also way off the bank's preferred 2-3 per cent target band.
They note that while economic growth overall had been a bit stronger than expected in 2015, it appeared to have been running at a more moderate pace since.
That means the jobless rate is expected to remain around present levels for a time before declining gradually on the back of an eventual pick-up in growth.
"Members discussed the merits of adjusting policy at this meeting or awaiting further information before acting," the minutes say.
On balance, the board was "persuaded" that prospects for sustainable economic growth, with inflation returning to target over time, would be improved by a rate cut at the meeting.
Su-Lin Ong, head of strategy at the Sydney branch of the Royal Bank of Canada, says at face value this suggests that a follow-up cut near term is unlikely.
But she cautions the RBA's revised inflation forecasts argue for at least one more cash rate cut to 1.5 per cent "sooner rather than later".
She also expects key figures in the next few weeks - wages, jobs, capital expenditure and growth - are all likely to be modest.
Consumer confidence appears to have had a delayed positive response to the May rate cut, having initially been muddled by a less upbeat reaction to the federal budget on the same day.
The weekly ANZ-Roy Morgan confidence gauge rose 1.1 per cent, remaining above its long-run average for a third consecutive week.
ANZ head of economics Felicity Emmett says news coming out of the federal election battle has been quite mixed and unlikely to impact on sentiment.
"With such a long election campaign, however, it will be interesting to see how quickly voter fatigue sets in," she says.
