With inflation now falling faster than anticipated and international economic headwinds building, economists say rates will remain on ice in September and beyond.

In fact, two-thirds of economists surveyed by comparison site Finder think interest rates have now peaked, which will spare typical homeowners another $78 increase in monthly repayments on a $500,000, 25-year home loan.

Among those calling another pause are the nation’s major forecasters, with Commonwealth Bank senior economist Belinda Allen saying interest rates will be on ice for some time yet.

“We do not view the meeting as a line-ball call, unlike the finely balanced decisions in July and August,” she said.

“The data flow over the past month and the large number of rate hikes delivered to date make it a clearer decision in September.”

The RBA has passed through four percentage points worth of rate hikes since May 2022 in a bid to curb sky-high inflation, and it appears as though it’s now starting to work.

After falling faster than expected over the June quarter, monthly inflation figures published last week by the Australian Bureau of Statistics (ABS) showed another bigger-than-forecast decline.

The monthly data is newer and not as comprehensive as the quarterly figures and so needs to be taken with a grain of salt, though the RBA has indicated a willingness to cite the data recently.

Wages growth has also disappointed, meaning central bankers may now be less concerned about what was seen as a headline risk for inflation earlier this year, given low productivity.

Jeffrey Sheen from Macquarie University said that the downwards trend in inflation has shown the RBA that it has done enough to achieve the 2 to 3 per cent inflation target in a reasonable time frame.

In fact, there are even building risks in the opposite direction, he explained.

“There is a significant risk of exported deflation and stagnation from China in the next six months, which may require the RBA to ease monetary policy,” Dr Sheen warned.

Most experts who are predicting another pause in September are also convinced that rates have peaked at 4.1 per cent, with the next move likely to be downwards from the RBA in 2024.

About 66 per cent of economists surveyed by Finder think rates are at their highest point, with 97 per cent predicting another hold in September.

That signals an extended period of relief for households, though it should be noted that much of the existing rate hikes are still being passed on by banks through retail mortgage interest rates.

There shouldn’t be any more big bill squeezes for the time being though, which comes at a good time for many families as rates of mortgage stress hit fresh highs earlier this month.

Roy Morgan data published last week showed 1.5 million mortgage holders (2.9.2 per cent) were “at risk” over the three months to July, a period that covered the June rate hike.

That’s a record high, with 640,000 more households in mortgage stress now than there were this time last year, Roy Morgan said.

This story first appeared in our sister publication The New Daily.