MNI BRIEF: Aussie CPI Measures Higher Than Expected

Australia’s Consumer Price Index rose 1.2% in the September quarter and 5.4% y/y, while the monthly read – also released today – increased 5.6% y/y, data from the Australian Bureau of Statistics showed Wednesday.

Both measures printed higher than market expectations, which had Q3 CPI at 1.1% q/q, or 5.3% y/y, and monthly inflation at 5.3% y/y. Q3 trimmed mean inflation was 1.2% q/q and 5.2% y/y, also higher than expectations. The higher reads will concern the RBA, which forecasted CPI to fall to 4.25% by Q4 within its Hidden PDF.

“CPI rose 1.2% in the September quarter, higher than the 0.8% rise in the June 2023 quarter,” noted Michelle Marquardt, head of prices statistics at the ABS. “The rise this quarter however continued to be lower than those seen throughout 2022.”

RBA Governor Michele Bullock struck a hawkish tone during her first public speech in Sydney Tuesday, noting the board will not hesitate to raise the cash rate further if there is a material upward revision to the outlook for inflation. (See MNI: Fresh Forecasts To Dictate RBA's Nov Decision - Bullock)