The RBA target band for core inflation (data below following the headline results) is sustainably in a 2 to 3% band.
Headline 0.8% q/q
For the y/y, 3.0%
- expected 3.1, prior 3.8% (lower expected mainly due to base effects)
Trimmed mean 0.7% q/q and 2.1% y/y
Weighted median 0.7% q/q (another measure of core inflation)
and 2.1% y/y
The core inflation measures are both higher than expected and both now within the RBA target band (the band is 2 to 3%, so at 2.1% just above the lower bound). The trimmed mean is at its highest since 2015.
The Australian dollar has been marked up a few points on the data result. Enough to shake out a few shorts. The higher inflation will add to market expectations that the RBA will be raising the cash rate before its promised 2024 at the earliest date.