The bond market has overblown a slight change in tone from the Reserve Bank on interest rates this week, according to fund managers after inflation data on Wednesday reinforced the case for rates staying on hold.

While the RBA reiterated at a press conference on Tuesday that rate cuts were unlikely this year, it also conceded that the board had not “explicitly” discussed a rate rise because of a change in the framework. That caught traders off guard because the central bank had debated lifting rates at its four previous meetings.