FXstreet.com (Barcelona) - NAB expects the December quarter CPI release (due 23 January) to confirm that inflationary pressures remained moderate in the final months of 2012.

NAB economist Robert Henderson notes: "We expect a core inflation rate of 0.7% (2.4% through the year; including the impact of carbon), which is unchanged from the September quarter outcome and well within the RBA’s comfortable range."

"With the unemployment rate expected to rise to near 5¾% by mid year, we still see the need for three 25 bps cuts, which we have tentatively pencilled in for March, May and August" Robert adds.