Australia Q2 Inflation Rate Highest in Over a Year

Australia's consumer price inflation rose to 2.1 percent year-on-year in the second quarter of 2018 from 1.9 percent in the previous period, but slightly below market expectations of 2.2 percent. Still, it was the highest rate since the first quarter of 2017, mainly due to higher prices of fuel, electricity and tobacco.

Transport cost increased by 5.2 percent year-on-year in the second quarter of the year, following a 2.9 percet rise in the previous three-month period, driven by a jump in automotive fuel prices (16.3 percent vs 6.1 percent). Also, prices rose faster for: alcohol and tobacco (7.8 percent vs 7 percent in Q1), mainly tobacco (16.6 percent vs 14.5 percent); recreation and culture (0.8 percent vs 0.6 percent); education (2.7 percent vs 2.6 percent); and insurance and financial services (1.5 percent vs 1 percent).

On the other hand, inflation eased for food and non-alcoholic beverages (0.3 percent vs 0.5 percent); housing (3.1 percent vs 3.3 percent), of which electricity (10.4 percent vs 11.7 percent); and health (3.4 percent vs 4.2 percent). Also, prices declined further for clothing and footwear (-2 percent vs -3.5 percent) furnishings, household equipment and services (-0.5 percent vs -0.1 percent) and communication (-4.2 percent vs -3.4 percent). 

RBA Trimmed Mean CPI rose 1.9 percent year-on-year, the same as in the first quarter and matching expectations. Quarter-on-quarter, the index increased by 0.5 percent, unchanged from the prior three months and in line with estimates. RBA Weighted Mean CPI rose 1.9 percent year-on-year in the three months to June, following a 2 percent rise in the March quarter and in line with forecasts.

On a quarterly basis, consumer prices went up 0.4 percent in the second quarter, the same pace as in the previous period and slightly below market consensus of 0.5 percent. The most significant price rises were automotive fuel (6.9 percent), medical and hospital services (3.1 percent) and tobacco (2.8 percent). By contrast, price falls were observed in domestic holiday travel and accommodation (-2.7 percent), motor vehicles (-2 percent) and vegetables (-2.9 percent).

Australia Q2 Inflation Rate Highest in Over a Year

ABS | Rida |
7/25/2018 7:42:35 AM