Inflation in Australia
Australia - Inflation
Inflation accelerates in Q2, driving up the AUD
In the second quarter of 2019, consumer prices jumped 0.6% over the previous quarter following a flat reading in the first quarter, according to the Australian Bureau of Statistics (ABS). The figure beat market expectations of a 0.5% quarter-on-quarter increase and marked the highest print in one-and-a-half years. According to the ABS, Q2’s rise was mainly the result of higher prices for transport, health, and for alcohol and tobacco, which were only partially offset by lower prices for communication, housing and food and non-alcoholic beverages.
Inflation rose to 1.6% in Q2 from Q1’s 1.3%, again overshooting market expectations. Therefore, inflation moved closer to the Reserve Bank’s 2.0%–3.0% target band. Regional variations persisted: Inflation came in between 1.3% and 1.7% everywhere excluding Hobart, where it exceeded 2.0%, and Darwin, where it was 0.8%.
Some pick-up in wage growth and early signs of bottoming out in house prices in the East coast will probably push inflation up. Markets reacted by driving the Australian dollar up, as they pared expectations for a rate cut at the Reserve Bank’s August meeting.
FocusEconomics panelists expect inflation to average 2.3% in 2019, which is unchanged from last month’s forecast, and 2.2% in 2020.
Australia - Inflation Data
|Inflation Rate (CPI, annual variation in %)||2.4||2.5||1.5||1.3||1.9|
5 years of economic forecasts for more than 30 economic indicators.
Australia Inflation Chart
Source: Australia Bureau of Statistics and FocusEconomics calculations.
|Bond Yield||0.93||1.47 %||Sep 04|
|Exchange Rate||0.68||0.05 %||Sep 04|
|Stock Market||6,656||0.08 %||Sep 04|
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October 17, 2019
Seasonally-adjusted employment rose by 14,700 in September, following a revised 37,900 job addition in August (previously reported: +34,700).
October 11, 2019
The business confidence index produced by National Australia Bank (NAB) dropped to minus 0.3 points in September, from plus 1.1 points in August.
October 11, 2019
The Westpac-Melbourne Institute consumer sentiment index dropped to 92.8 in October, from 98.2 in September, marking the worst result since July 2015.
October 4, 2019
Nominal retail sales in August rose a healthy 0.4% over the previous month in seasonally-adjusted terms, following July’s flat reading.
October 1, 2019
At its 1 October monetary policy meeting, the Reserve Bank of Australia (RBA) trimmed the cash rate from 1.00% to 0.75%, marking an all-time low.