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Following the below expectations Australia’s  Q1 2018 CPI  readings, today’s inflation figures for the Q2  showed a mixed picture, with the headline figures missing expectations. The core figures matched expectations, pushing the annualized inflation rates just within the Reserve Bank of Australia’s (RBA) 2-3 percent target range.

Main Headlines

Q1 CPI headline q/q +0.4% vs  0.5% exp and 0.4% prior.

Q1 CPI headline y/y +2.1% vs 2.2% exp and 1.9% prior.

RBA trimmed mean +0.5%  vs 0.5% exp and 0.5% last.

RBA trimmed mean y/y +1.9%  vs 1.9% exp and 1.9% last.

June Key Figures

The All Groups CPI

  • Rose 0.4% this quarter, compared with a rise of 0.4% in the March quarter 2018.
  • Rose 2.1% over the twelve months to the June quarter of 2018, compared with a rise of 1.9% over the twelve months to the March quarter of 2018.

Overview of CPI Movements

  • The most significant price rises this quarter are automotive fuel (+6.9%), medical and hospital services (+3.1%) and tobacco (+2.8%).
  • The most significant offsetting price falls this quarter are domestic holiday travel and accommodation (-2.7%), motor vehicles (-2.0) and vegetables (-2.9%).