By Stella Qiu and Wayne Cole

SYDNEY (Reuters) – Australia’s central bank on Tuesday left its cash rate steady as expected at 3.60%, saying recent data suggested inflation might be higher than forecast in the third quarter and that the economic outlook remained uncertain.

Wrapping up a two-day policy meeting, the Reserve Bank of Australia said the board judged it was appropriate to remain cautious on policy, but was well-placed to respond to international developments.

Markets had seen scant chance of a further easing this week after a strong second quarter GDP report and a high monthly inflation reading that argued for a measured pace of policy easing.

Swaps now imply a 40% probability of a rate cut at the next policy meeting in November, down from 50% before the statement. The Austral

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