That's a very substantial q/q rise for the PPI.
This data is from the Australian Bureau of Statistics (ABS), some commentary from their report:
- higher prices for construction, petroleum and energy were compounded by broad-based price increases in services, particularly health and childcare
- New financial year contract negotiations, indexation clauses, annual wage cost reviews and increasing operating costs contributed to price rises across services industries.
After the broad jump in CPI we saw in the data earlier this week this data is also showing higher services costs. Surely the Reserve Bank of Australia cannot maintain its complacency on inflation. It threatens to get away from them further.
The Bank next meet on 7 November and I, along with pretty much everyone, expect a 25bp RBA Rate hike.
Except for the RBA, they are still undecided apparently. RBA Gov. Bullock spoke yesterday and was non-committal, info in this link:
---
The Producer Price Index (PPI) measures a change in input prices of raw, semi-finished or finished goods and services.
- If input costs rise, some will be absorbed by the producer and some passed on to the consumer.
- Conversely, if input costs fall, some of the decline will be enjoyed as wider profit margins by the producer and some will be passed on to the consumer in the form of lower prices.
- Because PPI impacts consumer prices, it is watched by central bankers as part of fulfilling their mandate of price stability.
