Search ForexCrunch

According to analysts at ANZ, Australia’s Consumer Price Index for the first quarter of 2019 was weaker than they and the market anticipated.

Key Quotes

“The headline figure for March was in line with our forecast, but core inflation was materially lower at 0.2% q/q compared to our forecast of 0.4% q/q.”

“The weak print means that core inflation is trending away from the RBA’s target band. Without interest rate cuts, we see downside risk to inflation, with some of the weakness in the Q1 data likely to persist for some time.”

“We struggle to see how core inflation can get back to 2% y/y without additional monetary stimulus; and now expect the RBA to cut interest rates by 50bps by the end of the September quarter.”