According to data released on January 25, Beijing time,Australia’s CPI annual rate in the fourth quarter of 2022 was 7.8%, a 32-year high and the highest level since March 1990. This result suggests that inflation in Australia remains very strong even after a 3 percentage point rate hike from May to December 2022.
“Inflation in Australia may have peaked, but it’s still too high,” said Su-Lin Ong, head of fixed income strategy at Royal Bank of Canada.The data may dictate a 25 basis point rate hike in February, and a prudent approach may also be a 25 basis point rate hike in March, eventually reaching 3.6%.”
Rising prices for food, motor fuel and new home construction underpinned the annual rate of Australian CPI, data from the Australian Bureau of Statistics showed. Domestic and international travel-related expenses saw the biggest price increases, rising 13.3 percent and 7.6 percent, respectively.
The annual rate of CPI in Australia is as follows:
Economists surveyed had expected Australia’s second-quarter CPI to rise 7.5%, below the RBA’s forecast of 8%. Goods prices rose 9.5%, slightly down from 9.6% in the previous quarter – and the cost of services rose 5.5%, the most since 2008.
The trimmed annual rate of the central bank’s CPI in the fourth quarter of Australia was 6.9%, the highest level since the Australian government began releasing this information in 2003.
AUD/USD daily chart
At 13:34 on January 25th, Beijing time, the Australian dollar traded at 0.7101/02 against the US dollar