Our brains predict future sensory input based on their current beliefs about the world around us, but interpreting prediction errors can be challenging in a volatile environment because they can be caused by stochastic noise or by outdated predictions. Noisy signals should be integrated with prior beliefs to improve precision, but the two should be segregated when environmental changes render prior beliefs irrelevant. Bayesian inference provides a statistically optimal solution to deal with situations in which there is uncertainty about the cause of the prediction errors. However, the method quickly becomes memory intensive and computationally intractable when applied consecutively. Here, we systematically evaluate the predictive performance of Bayesian causal inference for human perceptual decisions in a spatial prediction task based on noisy audiovisual sequences with occasional changepoints. We elucidate the simplifying assumptions of a previously proposed reduced Bayesian observer model, and we compare it to an extensive set of models based on alternative simplification strategies. Model-free analyses revealed the hallmarks of Bayesian causal inference: participants seem to have integrated sensory evidence with prior beliefs to improve accuracy when prediction errors were small, and prior influence gradually decreased as prediction errors grew larger, signalling probable irrelevance of the prior due to a changepoint. Model comparison results further supported the hypotheses that participants computed probability-weighted averages over the causal options (noise or changepoint) and that they iteratively summarized their beliefs while accounting for causal uncertainty akin to the reduced Bayesian observer model. However, we also found that participants' reliance on prior beliefs was systematically smaller than predicted by the model, and this was best explained by individually fitting lower-than-optimal parameters for the a-priori probability of prior relevance. We conclude that perceptual belief updating in volatile environments with stochastic noise is well described by a simplified model of consecutive Bayesian causal inference. Observers utilize priors flexibly to the extent that they are deemed relevant, though also conservatively with a lower tendency to bind than an ideal Bayesian observer.