Australia: Q3 CPI likely to print 0.5% – ANZ
|Analysis team at ANZ suggests that they are forecasting the Australia’s headline inflation to print 0.5% QoQ in Q3, with the annual rate remaining at 1.6%.
Key Quotes
“The largest contributor to the headline figure was holiday travel and accommodation. Petrol prices are expected to detract from inflation this quarter, after rising sharply in the previous quarter.”
“Trimmed mean inflation, the underlying measure of inflation focused on by the RBA, is expected to come in at 0.4% q/q. This would see the annual rate stay at 1.6%. We see the risks to trimmed mean inflation for the quarter as skewed to the downside slightly.”
“Our forecast for trimmed mean inflation is in line with what the RBA published in its August SoMP. A number in line with this won’t put any pressure on the RBA to act sooner than we currently expect.”
“At this point, trimmed mean inflation would need to considerably disappoint for us to think the RBA will cut again in 2019. If the RBA eases in November, it is likely to be the result of a combination of the Fed easing in October and another weak month of retail’s sales suggesting that the tax cuts are not being spent rather than soft inflation.”
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