This week's key event for AUD/USD traders: Aussie CPI - Westpac

Analysts at Westpac offered their preview of this week;s key event for AUD/USD traders.
Key Quotes:
"Australian Q3 CPI preview: 0.7%qtr/1.9%yr
Outside of energy it is hard to find any sign of broader inflationary pressures.
September is normally a seasonally strong quarter due to the post June 30 price resetting of many administered prices. The ABS seasonal factors moderate our estimate to a seasonally adjusted 0.4%.
Key factors in Q3 are: ongoing grocery competition holding back food prices; annual repricing of the tobacco excise; surging electricity prices and further gains in dwelling purchase costs (Sydney and Melbourne); almost flat rents; and, falling health, transport (including fuel) and communication prices.
There is a lot of interesting in energy prices and we have estimated a national average rise in electricity bills of 13% and a 12% rise in gas bills. Ex gas & electricity we are forecasting a 0.27% rise in the CPI.
Core inflation is forecast to print 0.3%qtr (0.29% at two decimal places) holding the annual rate flat at 1.8%yr. The trimmed mean is forecast to rise 0.27% while the weighted median forecast is 0.32%. The two quarter annualised pace of core inflation is forecast to decelerate to 1.7%yr from 2.1%yr – well below the bottom of the RBA’s target band.
Traded prices are forecast to be flat in the quarter and –0.6%yr, while non-traded prices are forecast to rise 1.0%qtr/3.2%yr driven by rising housing and energy costs.
This is a soft update as outside of electricity, gas and dwelling purchases it is hard to find any signs of broader inflationary pressure with many consumer goods captive to a competitive deflationary cycle. Ex housing (which includes energy bills) the CPI is forecast to rise 0.1%.
The upcoming re-weighting of the CPI is only going to increase the emphasis of the disinflationary sectors making it even harder to generate an acceleration in inflation as we move through 2018."
Author

Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

















