The Australian dollar has fallen a third of a US cent after the release of weaker-than-expected inflation figures.

At 1130 AEST on Wednesday, the Australian Bureau of Statistics (ABS) announced the headline consumer price index (CPI) rose 0.4 per cent in the March quarter, for an annual rate of 2.5 per cent.

The CPI was expected to rise by 0.6 per cent in the March quarter for an annual rate of 2.7 per cent, according to an AAP survey of 15 economists.

Just before the CPI was released, the Australian dollar was at 102.75 US cents, and by 1131 AEST it had fallen to 102.38 US cents.

It finished the local session on Tuesday at 102.33 US cents.

The CPI figures are seen as crucial for the Reserve Bank of Australia’s interest rate decision at its May board meeting. Further cuts in the cash rate are less likely if inflation is high.