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Budget And CPI Focus Of The Week Ahead


This week the two major events in Australia will be the budget on Tuesday evening and CPI data for Q3 on Wednesday.

  • The first budget for Australia’s new government is to be delivered on Tuesday at 1930AEDT. Its focus is likely to be establishing Labor’s budgetary credentials while delivering on its election promises. Economic projections are to be downgraded while showing that Australia should avoid a recession. Treasurer Chalmers has been managing expectations and stating that the budget needs to be responsible.
  • On Wednesday, CPI data for Q3 and September are due to be published. While it is backward looking, it will be important for shaping RBA expectations. Economists expect the headline CPI to rise 1.6%q/q and 7%y/y (Q2 1.8%q/q and 6.1%y/y) and the trimmed mean by 1.5%q/q and 5.5%y/y (Q2 1.5%q/q and 4.9%y/y). The newly-established monthly series is expected to rise 7.1%y/y in September.
  • On Thursday, export and import prices for Q3 are released with the former expected to fall 6.5%q/q on lower commodity prices and the latter to rise 0.8%q/q. This would result in deterioration in the terms of trade in Q3.
  • Finally, on Friday the second-tier PPI for Q3 prints and should give an indication on pipeline inflation trends.
NAB final product prices vs CPI y/y%

Source: MNI - Market News/NAB/Refinitiv

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