The Reserve Bank is predicting monetary policy will have to stay tight

The bank's kept the Official Cash Rate at 5.5 percent, as largely expected by economists.

It says interest rates are bringing inflation down and the Consumers Price Index, which measures the rate of price changes - is expected to return to the desired one-to-three percent range by year's end.

The bank's forecasting a delay in interest rate cuts.

It says the Government Budget will also affect its decisions - because it remains to be seen if there'll be changes to government or public spending because of tax cuts.