Menu

Search

  |   Commentary

Menu

  |   Commentary

Search

Australia underlying inflation likely to remain low but stable in Q1, says ANZ Research

Underlying inflation in Australia is expected to remain low but stable in Q1, with the average of the two core measures expected to have risen by 0.4 percent q/q. This would be the third consecutive 0.4 percent quarterly outcome and would see annual underlying inflation lift a touch to 1.7 percent y/y, from 1.6 percent y/y in Q4 2016.

While last week’s meeting minutes highlighted the Reserve Bank Australia’s (RBA) current focus on the labor and housing markets, the CPI print remains of critical importance. The RBA would be disappointed by any further deceleration in underlying inflation.

The ANZ Property-Council survey for Q2 reported a strong gain in sentiment toward residential prices. This measures tends to be coincident with house prices, implying momentum continued to be robust in Q2.

On a more forward looking note, the construction outlook in the survey tends to lead dwelling approvals and commencements by 3-6 months. The recent pickup in this index suggests that the sharp drop in building approvals over the second half of 2016 may be approaching an end.

"The RBA would be disappointed by any further deceleration in underlying inflation.  Our picks for headline and core are below market," ANZ Research commented in its latest report.

  • ET PRO
  • Market Data

Market-moving news and views, 24 hours a day >

June 28 15:30 UTC Released

BRForeign Exchange Flows*

Actual

-5.279 bln

Forecast

Previous

-3.401 bln

June 28 14:30 UTC Released

BRBank Lending MM*

Actual

-0.2 %

Forecast

Previous

-0.2 %

June 28 19:00 UTC 195195m

ARBank Lending MM*

Actual

Forecast

1.9 %

Previous

0.8 %

June 28 21:00 UTC 315315m

KRBOK Manufacturing BSI*

Actual

Forecast

Previous

82 bln

June 28 23:50 UTC 485485m

JPForeign Bond Investment

Actual

Forecast

2.6 bln JPY

Previous

3.2 bln JPY

June 28 23:50 UTC 485485m

JPForeign Bond Investment

Actual

Forecast

Previous

1090.1 bln JPY

June 28 23:50 UTC 485485m

JPForeign Invest JP Stock

Actual

Forecast

Previous

-331.6 bln JPY

June 28 23:50 UTC 485485m

JPForeign Bond Investment

Actual

Forecast

Previous

1090.1 bln JPY

June 28 23:50 UTC 485485m

DERetail Sales YY

Actual

Forecast

2.6 %

Previous

3.2 %

June 28 23:50 UTC 485485m

JPForeign Bond Investment

Actual

Forecast

Previous

1090.1 bln JPY

Close

Welcome to EconoTimes

Sign up for daily updates for the most important
stories unfolding in the global economy.