ING on today's inflation data and imp[lications for the Reserve Bank of Australia.

In brief:

  • Much of the recent inflation disappointment can be put down to one-offs, weather-related and other seasonal effects. But that still leaves inflation higher, and likely to come down slower than otherwise
  • But while we had harboured hopes that base effects would start to quickly bring down inflation, enabling the RBA to stop hiking once rates reached 3.6%, which they would have done by the March meeting, we now believe they will have to keep hiking for at least another 2 meetings, taking the peak cash rate up another 50bp to 4.1%.


Earlier posts:

Australia Q4 Headline CPI 1.9% q/q (expected 1.6%)

AUD/USD jumps on the higher than expected Australian CPI report

There was a second CPI data point from Australia, came in at a rocketing 8.1% (from 7.3%)

The RBA website has outdated data on it, big time!

ANZ says Australian CPI data 'cementing' in 25bp rate hike at the RBA February 7 meeting


AUD/USD had risen to highs over 0.7100:

audusd cpi rba 25bp 25 January 2023