MNI BRIEF: Aussie Goods Prices Strong - RBA's Hauser

MNI (MELBOURNE) - Australian goods prices have not deflated as fast as other peer economies, Reserve Bank of Australia Deputy Governor Andrew Hauser told the House of Representatives Standing Committee on Economics Friday. 

While services inflation had largely tracked the international experience, the composition of Australia’s goods prices had kept it higher than global comparisons, he noted. “We've roughly had goods inflation at around zero, and we do include elements of housing costs in the goods-price index here that aren't necessarily included elsewhere,” he said. 

Services inflation had proven challenging globally, he continued. “For example, [UK] services inflation has been well above 5% nearly 6% which is pretty eye popping, actually, in the context of the overall [2%] inflation target,” he argued. “That is a common analytical challenge towards services prices. This challenge that we might sometimes think is uniquely Australian is in fact very common across countries.”

The RBA decided to hold the cash rate at 4.35% at its most recent meeting last week. (See MNI RBA WATCH: Board Holds, Shrugs Off Market Volatility)