October 26, 2022 01:37 GMT
Capital Economics Expects Inflation To Rise Further And RBA To Follow
Capital Economics economist Thieliant has said that inflation hasn’t peaked yet and that this is likely to mean that “the Reserve Bank of Australia will hike rates more aggressively than most anticipate”, according to The Australian.
- Thieliant noted that price pressures were broad based but that the slowdown in housing is finally impacting dwelling prices as Q3 posted the lowest increase in a year.
- He pointed out that state energy rebates had held down power prices in Q3 and without them the headline CPI would have risen 2.1%q/q rather than 1.8%. Capital Economics don’t expect these rebates to be included again in Q4 and so utilities prices are likely to make a strong contribution to the CPI, which they expect to “approach 8 per cent” (The Australian).