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>>Australian CPI figures expose worrying inflationary pressures, reinforcing a hawkish outlook for the RBA

Australian CPI figures expose worrying inflationary pressures, reinforcing a hawkish outlook for the RBA

crypthub

about 11 hours ago

CPI Shows Stubborn Inflation

The latest Australian CPI shows headline inflation easing but staying well above the RBA’s 2‑3% goal. The trimmed‑mean core rate remains sticky, driven by fast‑rising services such as health, insurance and education. Strong wage agreements add to a wage‑price spiral, creating a “last‑mile” disinflation problem.

RBA Maintains Hawkish Stance

Markets have raised the likelihood of another rate hike and pushed back expectations for the first cut. Governor Bullock cites the data as proof that a restrictive cash‑rate is still needed. The central bank warns that bringing inflation back to target will be slow and bumpy.

Sectoral Pressures Emerge

Higher rates pressure mortgage borrowers and dampen housing demand, while a stronger Australian dollar hurts exporters. Business investment faces higher capital costs and lingering input‑price pressures. Core CPI components—services, rents and wages—continue to outpace goods inflation.

Outlook for Households and Economy

Consumers with variable‑rate loans can expect prolonged repayment growth, limiting discretionary spending. The RBA aims to avoid entrenched inflation even at the cost of short‑term pain. Continued data‑dependence means further tightening remains possible if price pressures persist.