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Inflation Expectations Moderate And Remain Anchored

AUSTRALIA DATA

The Melbourne Institute’s measure of inflation expectations moderated to 5.2% in December after 6% the previous month and in line with the moderation seen in petrol prices so far this month (see "Petrol Prices Point To Easing In December Inflation Expectations"). It is now at its lowest since April. Given it has moved in the same direction as petrol prices in every month from June, it is difficult to gauge if it is signalling a peak in inflation. But the RBA should continue to feel confident that inflation expectations are anchored.


Australia MI inflation expectations % vs CPI y/y%

Source: MNI - Market News/Refinitiv

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