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Higher January Petrol Prices Could Lift Inflation Expectations

AUSTRALIA DATA

The Melbourne Institute’s consumer inflation expectations series for January prints today. In the last 6 months, it has had a very close relationship with the movement of national petrol prices. In December it dropped to 5.2% from 6% in line with falling petrol prices at the time (see chart). So far in January petrol prices are 3.5% higher on the month, although they did fall 3.3% w/w in the week ending January 15. The higher month average though could mean we see a tick up in inflation expectations again.


Australia MI consumer inflation expectations vs petrol prices

Source: MNI - Market News/Refinitiv/Australian Institute of Petroleum

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