Australia: CPI forecast is 0.6%qtr lifting the annual pace to 2.3%yr - Westpac

The analysis team at Westpac forecasts the Australian CPI to rise by 0.6%qtr, lifting the annual pace to 2.3%yr from 1.5%yr.

Key Quotes

“March is a seasonally softer quarter with the ABS seasonal factors boosting our seasonally adjusted estimate to 0.8%qtr.”

“The Q4 CPI printed 0.5% compared to Westpac’s forecast for 0.7%. The December quarter presented a clearly softer inflation profile compared to the more mixed results from the September quarter. Early signs of AUD pass-through faded and discounting in the consumer space returned.”

“We are forecasting a reversal in fresh fruit & vegetable prices, further declines in clothing & footwear plus household contents & services while housing costs remain contained. Offsetting is seasonal jump in pharmaceuticals, the bump in auto fuel prices and signs that the energy crisis is feeding into higher utility bills.”