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MNI: RBA's Underlying Forecasts Rest On Q/Q Results

The RBA will focus mostly on high frequency CPI data, according to former economists.

MNI (SYDNEY) - The Reserve Bank of Australia will place more weight on the quarter-on-quarter trimmed mean CPI, which showed only a 10-basis-point fall in Q3 to 0.8%, and less emphasis on the 3.5% y/y result, when formulating its next set of forecasts and considering whether inflation is sustainably returning to target, former RBA economists told MNI. 

John Simon, adjunct fellow at Macquarie University and head of the economic research department at the RBA between 2014-2024, said the Reserve's focus is on its forecasts of inflation, "for which the quarterly number is more important."

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MNI (SYDNEY) - The Reserve Bank of Australia will place more weight on the quarter-on-quarter trimmed mean CPI, which showed only a 10-basis-point fall in Q3 to 0.8%, and less emphasis on the 3.5% y/y result, when formulating its next set of forecasts and considering whether inflation is sustainably returning to target, former RBA economists told MNI. 

John Simon, adjunct fellow at Macquarie University and head of the economic research department at the RBA between 2014-2024, said the Reserve's focus is on its forecasts of inflation, "for which the quarterly number is more important."

Keep reading...Show less