Bank desk reactions to yesterday's Q3.....>

AUSTRALIA: Bank desk reactions to yesterday's Q3 CPI release.

- ANZ: Data was exp. to confirm weak price pressures, but was below market exp.,

although broadly in line with ANZ's f'casts. Encouragingly, domestic market

services inflation accelerated in Q3, suggesting that these prices are

responding to the pick-up in unit labour cost growth.

- Barclays: Although growth remains supportive, we think the issues of: 1) low

wage growth; 2) subdued CPI; & 3) falling house prices continue to weigh on the

econ & maintain the disinflationary outlook. These 3 factors are likely to delay

policy normalisation for some time, even if employment & growth remain

relatively strong. Against this disinflationary backdrop, we think the RBA is

likely to look through the decline in unemployment. The RBA's continued cautious

outlook supports our view that the rate hiking cycle is likely to begin in H120.

- Westpac: Incorporating revisions, the six month annualised growth in core

inflation is only 1.5%yr, well below the bottom of the RBA band & the slowest

pace since Sep 16. With core inflation well below the bottom of the RBA's target

band we can find little to suggest any risk of a meaningful acceleration.