Mortgage holders will be feeling uneasy ahead of another close interest rate call that could see their monthly repayments blow out even further.

The Reserve Bank has been battling high inflation with higher interest rates since May last year and has so far handed out 400 basis points of increases.

The board is due to meet on Tuesday for the July cash rate decision.

Inflation may be moderating but economists worry the slowdown is not fast enough to guarantee the end of the central bank’s tightening cycle.

The headline inflation number fell sharply over the month of May, from 6.8 per cent to 5.6 per cent, but Westpac economist Bill Evans said the slowdown across consumer prices was less convincing when volatile items were stripped out.

Mr Evans said the case for a further rate increase has strengthened since the last board meeting.

Top of his list was the RBA’s preoccupation with high inflation becoming entrenched, especially if more workers receive wage rises in line with rising prices.

The strength of the labour market was another source of concern.

Opinions divided

Westpac, along with ANZ and NAB, is tipping another hike for July and a final one in August before tapping out at 4.6 per cent.

Commonwealth Bank is the only one of the big four banks expecting the RBA to stay on hold this week, but the group’s economists do expect one more hike in August.

The economists surveyed by comparison site Finder also held a range of views, with a slight majority – 20 of the 39 – anticipating a July lift.

Moody’s Analytics economist Harry Murphy Cruise expects the RBA to stay on hold in July but at least one more hike in the coming months.

He said the economy was in a “tug-of-war”, caught between rising prices and the RBA hiking interest rates aggressively.

“As it stands, the RBA has its nose ahead in the contest,” Mr Murphy Cruise said.

He said the economy was slowing, spending was going sideways, and firms were winding back their hiring plans, which was all helping to bring down inflation.

Key data due

The Australian Bureau of Statistics is also set to release a bunch of noteworthy data this week, including building approvals and lending indicators on Monday.

Home price data from CoreLogic will round out a big start to the week for housing data.

On Thursday, the national statistics bureau will release international trade data for the month of May.

Wall Street indexes closed higher on Friday, with the tech-heavy Nasdaq posting its biggest first-half gain in 40 years as inflation showed signs of cooling while Apple returned to a $US3 trillion ($A4.5 trillion) market valuation.

The S&P 500 gained 53.37 points, or 1.21 per cent, to end at 4,449.81 points, while the Nasdaq Composite gained 193.85 points, or 1.43 per cent, to 13,785.18.

The Dow Jones Industrial Average rose 278.00 points, or 0.81 per cent, to 34,400.42.

Australian futures rose 29 points, or 0.40 per cent, to 7190.

The benchmark S&P/ASX200 index on Friday finished up 8.4 points, or 0.12 per cent, to 7,184.1, while the broader All Ordinaries rose 11.9 points, or 0.16 per cent, to 7,401.5.

-AAP