Australian August CPI 2.7% y/y, lower than expected and under the top end of the Reserve Bank of Australia 2 – 3% target band. Good news.
- expected 2.8%, prior 3.5%
- 2.7% y/y is the lowest since August of 2021
- the m/m came in at negative 0.2%
Trimmed mean 3.4% y/y
- expected 3.4%, prior 3.8%
- this above 3% rate for underlying inflation is still a throny issue for the Reserve Bank of Australia, the Bank cites sticky high underlying inflation as a reason to hold the cash rate high
This much improved result is partially due to the largest annual drop in electricity prices on record, down nearly 18%. This is due to combined Commonwealth and State government rebates. Indeed, current RBA forecasts are for a headline CPI rate bounce back above 3% once these subsidies roll off.
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The monthly CPI data from Australia does not show all components of the CPI, that’ll have to wait for the quarterly data release.
- The monthly CPI indicator does, however, provide a timelier indication of inflation using the same data collected for use in the quarterly CPI. The monthly reading includes updated prices for between 62 and 73 per cent of the weight of the quarterly CPI basket, its not the full picture.
The quarterly CPI reading for the September quarter is not due until Wednesday 30 October