AUSTRALIA DATA
Source: MNI - Market News/Refinitiv
- The rebate-impacted headline came in 0.1pp below consensus at 0.2% q/q and 2.8% y/y down from Q2’s 3.8%. The ABS said that electricity prices fell 17.3% q/q and without government rebates would have risen 0.7% q/q. Petrol prices also weighed with lower global oil driving a 6.7% q/q drop in auto fuel prices.
- Food rose 0.6% q/q driven by meals out, meat and fruit & veg.
- With headline artificially low, the focus is on underlying and domestically-driven measures. While Q3 trimmed mean remains above the top of the RBA’s band, it was the lowest since Q4 2021, which should reassure them. It will likely need more data though to determine if it looks sustainable.
- Problematically, the Q3 moderation was driven by the goods/tradeables components, while services picked up although non-tradeables moderated to 4.1% y/y from 5%.
- Services rose 1.1% q/q and 4.6% y/y up from Q2’s 1.0% and 4.5%, in line with Q4 2023, driven by rents, insurance and child care. Core services were also strong rising 1.3% q/q and 4.1% y/y after 1.0% and 4.1% y/y. The lack of progress will likely continue to worry the RBA.
- Goods prices fell 0.6% q/q to be up 1.4% y/y down from 3.2% due to electricity and fuel. Tradeables fell 0.2% q/q to be 0.6% y/y after 1.5% y/y in Q2.
Australia services vs goods CPI y/y%
Source: MNI - Market News/Refinitiv
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