The data release is here:
- Australian August CPI 2.7% y/y (expected 2.8%)
- down from 3.5% in July
As I said in that post, the drop in headline inflation is mainly 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.
The rate of core inflation, as shown in the 'trimmed mean' came in above target still at 3.4% (but well down from July)
- 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
So, 'fraid the good news is ... transitory.
Let me finish on an upbeat note though. One of the other factors for lower headline inflation in August were lower petrol (gasoline for you all in the US) prices. These stayed low in September, so that's some positive news.
The regular caveat is this monthly data is not a complete picture.
As posted earlier ...
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