Bond investors have given up on an interest rate increase next week, after a softening in price pressures gave the Reserve Bank of Australia some breathing room to assess how the economy is faring after the fastest monetary tightening in a generation.

Interbank futures scaled back the probability of a rate increase, ascribing only a 9 per cent chance of a 0.25 percentage point increase to 3.85 per cent at the policy meeting on May 2. It was a 28 per cent probability before the data.