In a unanimous decision, the central bank's nine-member monetary policy board left the cash rate untouched at 4.35 per cent on Tuesday.
The result was widely expected by economists and money markets.
While the re-escalation in the Middle East conflict has sent oil prices surging once more, softer-than-expected inflation figures in late July killed off expectations of an August rate hike.
Both headline and underlying inflation remained above the RBA's 2-3 per cent target range in the June quarter.
But at 3.6 per cent, the bank's preferred quarterly trimmed mean measure undershot its previous forecast of 3.8 per cent and gave the board more breathing room to watch how developments played out in the Strait of Hormuz.
Economic forecasts released by the bank at the same time as its rate decision showed the RBA still expected inflation to remain above 2.5 per cent until early 2028.
Another consideration for the RBA is the rapidly deteriorating housing market, which could weigh on household consumption and take more steam out of the economy.
House prices were already starting to come down after the RBA's three rate rises in the first half of 2026, which added around $270 a month in mortgage repayments for a $600,000 mortgage.
But the downturn has accelerated since the federal budget curbed tax concessions for property investors.
In its Statement on Monetary Policy, the RBA noted a deeper decline in housing prices than anticipated could further weigh on economic growth.
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