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As we noted last week following the release of the third quarter CPI data, the RBA are clearly in no hurry to start cutting rates. Their recently released Statement on Monetary Policy (SOMP) starts out with a clear message… “Underlying inflation remains too high. Headline inflation has fallen sharply in …read more
Today’s release of the third quarter CPI data was broadly in line with market expectations. Headline CPI fell to 2.8% (which is just inside the RBA’s 2-3% target range) but the more closely watched Trimmed Mean (core inflation) remained somewhat elevated at 3.5%. The reason the RBA will be focused …read more
Dec quarter inflation came in this morning pretty much as people were expecting…that is, weak. CPI rose just 0.5% for the quarter which sees the annual rate drop to 1.8% (from 1.9% previously). The more closely watched measures (at least by the RBA) of core inflation, the trimmed mean and …read more
Despite the headline (seasonally adjusted) CPI data coming in a good deal lower than expected, the more significant (so far as potential RBA rate decisions is concerned) core inflation measures nudged very slightly higher in the June quarter. The headline CPI came in as +0.2% q/q for a +1.9% y/y …read more
Each month the Melbourne Institute release their Survey of Consumer Inflationary Expectations. This gives a good indicator where people believe inflation is heading. The chart below compares those expectations (on a quarterly basis) with the actual average core inflation data. What we see is that generally people’s expectations are, on …read more
After the release last week of the low CPI numbers, and the RBA’s subsequent decision to cut rates by 25 bps yesterday (see below), it comes as no surprise to see the quarterly Cost of Living Indexes confirming the lack of any inflationary pressure. The COL Indexes are designed to …read more
Any concerns that the market might have had two weeks ago about the May 5th cut to the Cash Rate can be laid to rest by the Minutes of the meeting released this morning (and available here). The take-away message from the Minutes can be found in one of the …read more
As had been almost universally expected, the RBA today decided to shave another 25 basis points off the official Cash Rate to take it to a new low of 2.0%. In the press release announcing the decision (available here) the Board notes that commodity prices remain low, and CAPEX is …read more
The headline inflation measure (Consumer Price Index, CPI) for the second quarter has come in bang-on market expectations at +0.2% q/q for a 1.3% increase over the year. The increase comes courtesy of a 2.6% yr/yr increase in non-tradables being offset by a 0.9% yr/yr fall in tradables. The more …read more
Just a few days ago we posted explaining why we thought the RBA would not be cutting the Cash Rate today (you can read it here), but we have been proven sadly wrong with the RBA cutting 25bps from the Cash Rate to 2.25% at today’s Board meeting. Clearly Terry …read more
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