Australia: Annual underlying inflation to rise from 1.55% to 1.89% y/y - TDS

The analysis team at TDS is looking for Australia’s Q1 CPI trimmed mean to increase by +0.6% q/q, rising from 1.6% y/y to 1.95% y/y, and combined with a +0.5% q/q lift in the weighted median (or 1.83% y/y), they see overall annual underlying inflation rising from 1.55% to 1.89% y/y.

Key Quotes

“As this is consistent with the RBA looking for 2% underlying inflation by mid-year, it shouldn’t surprise the markets, especially after this week’s stronger NZ CPI. Market range for trimmed mean is +0.3% to +0.6%, clustered around 0.5%.”