Australia Wage Price Index for Q3 2021 +0.6% q/q amd +2.2% y/y
expected 0.5% q/q, prior 0.4%
expected 2.2% y/y, prior 1.7%
Reserve Bank of Australia Governor Lowe spoke yesterday and was very doubtful indeed that wage growth in the near term would be enough to prompt a rate hike from the Bank:
- RBA Gov Lowe spoke Tuesday - told analysts, markets they are wrong about rate hikes
- ANZ recap of RBA Governor Lowe's speech - 5 key takeaways
- RBA Gov Lowe Q&A now - says will not hike rates to control house prices
- RBA Gov Lowe: Underlying inflation at 2.5% would not be enough for a rate hike
2.2% y/y for the quarter past is supportive of Lowe's exhortations that analysts and markets pricing in rate hikes next year is off track. The view at the RBA is that wages growth in excess of 3% is needed to sustain inflation at the mid-point of the 2-3% target.
To the extent that AUD is also pricing in 2022 rate hikes this is a negative input. 2.2% is about where RBA forecasts presently are.