Australia second quarter inflation, April to June 2018
Headline comes in at 0.4% q/q … lower than the consensus estimate
- expected +0.5% q/q
- prior was +0.4%
2.1% y/y ... lower than the consensus estimate
- expected 2.2%
- prior 1.9%
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Trimmed mean 0.5 % q/q … in line
- expected 0.5%
- prior 0.5% q/q
1.9% y/y ... in line
- expected 1.9%
- prior 1.9%
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Weighted median 0.5% q/q ... in line
- expected 0.5% q/q
- prior was 0.5%
1.9 % y/y ... in line
- expected 1.9%
- prior was 2.0%
Its the core measures that are the important ones, both in line with consensus.
Headline is slightly under.
Overall, well, wait 3 months for a ho hum zzzzzzzzz result.
The response of the AUD was very little, a slight wiggle and as I update it is drifting off a few points. There is not too much AUD input from this set of results except to say the RBA is still on hold for a good while to come.
The
RBA has a dual mandate: full employment and stable prices. The RBA's interpretation of stable prices is a 2 to 3% inflation target (for core inflation) over the course of a cycle. Employment is improving, although the rates of underemployment would argue there is plenty of work still be done, as would slow wage growth; and , as you can see, inflation is missing target (albeit not by too much but a miss is a miss). Some would argue the ammunition is there for the RBA to cut rates. But, agree or disagree with that the fact is the Bank is inclined to stay on hold. Watch for any communication that might change that stance, but there has not been any.
