Australia: 3Q24 headline inflation back in RBA’s target for first time in three years – UOB Group
Australia's consumer price inflation rate fell to its lowest since early 2021 in the third quarter on government’s electricity rebates and a drop in gasoline prices, UOB Group’s Economist Lee Sue Ann note.
First rate cut can arrive only at the February meeting in 2025
The annual pace of inflation came in at 2.8% y/y in 3Q24, significantly lower from 3.8% in 2Q24. CPI rose 0.2% q/q in 3Q24, a tad below expectations of 0.3% q/q.”
“However, core inflation, remains elevated. The trimmed mean measure increased by 0.8% q/q, just above forecasts of a 0.7% gain. The annual pace slowed to 3.5% from 4.0%, with service-sector inflation still elevated.”
“While 4Q24 is still a possibility, we are now pushing back our first rate cut forecast from Nov to Dec. There is even the possibility that the first rate cut will not arrive until its Feb meeting in 2025, if the RBA chooses to wait for the 4Q24 CPI print, due for release on 29 Jan 2025.”
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