TD Securities - Melbourne Institute Monthly Inflation Gauge

Headlines in at 0.0% m/m

  • prior 0.5%

For the y/y: 2.8%

  • prior 2.6% y/y (which was the highest since July 2014)

For the core measure, the 'trimmed mean' inflation rate: 0.1% m/m & 2.1% y/y

  • prior 0.3% m/m
  • prior 1.7% y/y

The most notable for this release is the 'trimmed mean' (IMO). At 2.1% it is back within the Reserve Bank of Australia target band (which is 2 to 3% for core inflation). The Australian dollar is up a few tics (its barely moving). Inflation has been expected to drift back lower in coming months, this move higher for core today is a bit of a surprise.


Still to come ... 0130GMT - Australia - Q1 Inventories and Company Profits Q1 Inventories

  • expected +0.5% q/q, prior +0.3% q/q
  • Rising demand has seen inventory build, this is the expectation for this data point today - there is scope for a downside surprise here given softer data from Australia. Something to be aware of.

Company Operating Profit

  • expected +5.0% q/q, prior +20.1%
  • Higher commodity prices were a big factor in the previous surge in profit (Q4 of 2016), and continued strength is expected today though not to the same extent

Australian GDP data is due later in the week, these two will provide guidance for that data. Downside surprises should be a negative for the Australian dollar (and vice versa).