Ahead of tomorrow's Australian CPI........>

AUSTRALIA: Ahead of tomorrow's Australian CPI release (0130GMT), analysts at ANZ

expect Q2 inflation data to show that any acceleration in inflationary pressures

remain very gradual. Headline inflation will likely tick up to 0.5% q/q, due to

a rise in petrol prices, the seasonal increase in health insurance premiums and

the regular tobacco indexation. Core inflation is expected to be steady at 0.5%

q/q and 1.9% y/y, just below the RBA's target band.

- CBA Expect the headline inflation rate to rise by 0.6%, bringing the annual

rate to 2.3% and comfortably within the RBA's 2-3% target range.

- Westpac anticipate another 0.4% print, lifting the annual figure to 2.1%. The

average of the RBA core measures was 0.5%qtr, 2.0%yr in Q1. We anticipate

0.5%qtr, 1.9%yr for Q2. In short, inflation is at the bottom of the RBA's target

band at a time of weak wages growth, intense competition across retail and

supermarkets, as well as a housing slowdown.

- RBC expect headline CPI to have risen by 0.6% in Q2, lifting the y/y rate to

2.3% boosted by some base effect.