Analysts at TD Securities note that Australia’s Q3 headline inflation edged up 0.5%/q in line with market estimates but down from 0.6%/q in Q2 to be 1.7%/y.
Key Quotes
“More important was the core inflation, the trimmed mean at 0.4%/q, 1.6%/y. Although this was the 20th successive quarter that core CPI has come in below the mid-point of the RBA’s 2-3% target band, the fact that the outcome was in line with the market and RBA’s forecast implies a cash rate cut is highly unlikely next week. That said we do anticipate cuts to the 2020 GDP track in next week’s SoMP should pave the way for a cut to 0.5% at the Bank’s Feb meeting.”
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