preview of Australia CPI data

Australian Q3 CPI preview data is due on Wednesday, 25 October 2023

• at 11.30 am Sydney time, whoch is 0030 GMT and 2030 US Eastern time

Via ING on what to expect:

• The good news is that we think there is a chance that the headline inflation rate could manage not to rise again in September.
• The bad news is that we think it may stay at 5.2% year-on-year, unchanged after it rose in August.

And further, on implications for the Reserve Bank of Australia’s November 7 meeting:

• Is this enough to keep the RBA on hold?

• The last minutes suggested the RBA had quite a low tolerance for inflation to remain above their target, so “failure to make satisfactory progress” might be considered a sufficient condition for a further hike.
• The alternative is to wait one more month. While the base effects aren’t much better in October, then at least you wouldn’t be facing possible pressure to hike twice.
• If the RBA does hold rates unchanged at both meetings – which isn’t our base case, as we think they will hike at one of them – then we see the chances of them hiking in the New Year (as the market is pricing in) as very low. Very high inflation spikes at the end of 2022 mean the inflation rate should be dropping sharply again as reported in early 2024.

Earlier:

Ahead of the inflation data is this: