Due at 0030 tomorrow, Wednesday 31 January

The 'headline' result is the q/q CPI for Q3:

  • expected is +0.7%,
  • prior was +0.6%

For the y/y,

  • expected is 2.0%, prior 1.8%

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For the 'trimmed mean' (which is the measure the RBA pays most heed to): it is the 'core' inflation figure where the RBA target band is 2 -3%.

For the q/q:

  • expected 0.5%,
  • prior 0.4% q/q

For the y/y:

  • expected is 1.8%, prior 1.8% (note, both below the minimum of the target band)

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Finally, there is the 'weighted median' CPI:

  • For q/q: expected is 0.4%, prior was 0.3%
  • For y/y: expected is 1.9%, prior was 1.9%

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Quick preview via TD Securities:

  • We expect both headline and underlying inflation to rise. The trimmed MI Monthly mean from Oct-Dec (2.5%/yr) suggests upside risk to our forecast. If underlying inflation reaches 2% after two years tracking below RBA's target band, it would exceed the RBA's Nov projection of 1.75%.

And, another, this via RBC:

  • Partial indicators suggest a small pick-up in headline inflation in Q4, with the key core measures likely to remain more subdued.
  • Largely reflecting a rise in fuel prices in the quarter (also evident in this week's NZ inflation print) and some reversal in the sharp drop in vegetable prices in Q3, we expect headline inflation to rise by 0.8%q/q, taking the y/y rate to 2.1%.
  • We estimate that fuel will contribute ~0.3pp to this increase. We expect the average of the trimmed mean and weighted median to be 0.4%, taking the y/y rate down slightly to 1.8% and broadly in line with the RBA's 1¾% forecast from its most recent November Statement on Monetary Policy.
  • Annual core inflation is likely to have been sub 2% for the ninth consecutive quarter.
  • We will also be watching a number of other key core measures which continue to run at an even weaker pace than the trimmed mean and weighted median. A reweighting of the CPI components is supportive of a likely modest core print.

Earlier previews:

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