Analysts at a major Australian investment bank, Barrenjoey Capital Partners, point out that Australia’s recent inflation performance is about the worst on the planet:
- “Using the trimmed average is preferable – Australia’s six-month annualized rate of truncated average inflation of 3.6% is the highest inflation in the world (higher even than the US at 3 .2% 6mAR truncated).”
Data information is here as of Wednesday’s release:
Westpac’s view:
This take is perfect:
Staggering, higher-than-expected widespread inflation figures are rippling through the markets.
Via the Commonwealth Bank of Australia:
- three-year Australian government bond yield jumps 13 basis points to 4.03%
- Interest rate markets now price only a small chance of a single 25 basis point rate cut by the end of the year.
TD says forget about a Reserve Bank of Australia rate cut in 2024 due to:
a strong job market
high and continued migration to Australia
rising energy prices
And to conclude:
- “The RBA is likely to take a more hawkish stance, but is loath to act,”
- expect the first reduction now in February 2025
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From the front page of the RBA website. The RBA’s target range for inflation is 23% to 3%. Not there yet.
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