Australia's CPI has been tracking below the RBA target band for many years now. Q1 2020 will be no different … but does it even matter?

The focus from the Reserve Bank of Australia is providing liquidity, stimulus and stability to the market in the face of the coronavirus outbreak, not on hitting the CPI target.

But, for those tracking CPI, tomorrow brings the Q1 data.


  • expected 0.2% q/q, prior 0.7%

For the y/y,

  • expected 1.9%, prior 1.8%

Core inflation:

Trimmed mean

  • expected 0.3% q/q, prior 0.4%
  • expected 1.6% y/y, prior 1.6%

Weighted median

  • expected 0.4% q/q, prior 0.4%
  • expected 1.5% y/y, prior was 1.3%

Comments via ANZ (in brief):

  • Anticipated sharp falls in petrol and travel and holiday accommodation prices are the largest drag on the headline figure.
  • We are not expecting a change in the trimmed mean measure from the previous quarter.
  • Given the current environment, a surprisingly weak inflation forecast is unlikely to spur the RBA into additional policy action, given not only the unconventional monetary policy so far but also because the Governor Lowe has flagged that the RBA is expecting to see inflation go negative on an annual basis by as early as June.