The Reserve Bank has left interest rates on hold in December, for a ninth-straight meeting, citing underlying inflation remaining too high.

The RBA kept its cash rate target at 4.35 per cent after a two-day meeting, a level it has been at since November 2023.

That is despite Australia's economy recording its weakest annual growth rate in decades — outside of the pandemic — in the September quarter and inflation at a more-than-three-year low.

In its post-meeting statement, the RBA board said despite inflation falling from its peak in 2022, it wanted to see further easing.

"While headline inflation has declined substantially and will remain lower for a time, underlying inflation is more indicative of inflation momentum, and it remains too high," the statement read.

This is a change in language from the board's November statement, which said it needed to "remain vigilant to upside risks to inflation" and was "not ruling anything in or out".

The Australian dollar fell in reaction to the news, indicating traders now saw a greater chance of earlier interest rate cuts.

The board's statement noted weak growth in the September quarter, with the economy expanding by just 0.8 per cent over the past year.

"Past declines in real disposable income and the ongoing effect of restrictive financial conditions continued to weigh on household consumption spending, particularly on discretionary items," it read.

"Taking account of recent data, the Board's assessment is that monetary policy remains restrictive and is working as anticipated.

The next chance borrowers have for a reprieve is in February.

RBA governor Michele Bullock will hold a press conference at 3:30pm AEDT.