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Australian core consumer prices matched estimates last quarter
[SYDNEY] Australia's core consumer prices matched economists' forecasts last quarter, providing scope for the central bank to reduce interest rates.
The trimmed mean gauge of core prices rose 0.6 per cent from the previous quarter, the Bureau of Statistics said in Sydney today, in line with the median forecast of 25 economists. The consumer price index advanced 0.2 per cent from the prior three months, compared with economists' forecast for a 0.1 per cent increase.
Reserve Bank of Australia Governor Glenn Stevens has left the benchmark cash rate unchanged in the past two months after cutting to a record 2.25 per cent in February. Policy makers are trying to reinvigorate domestic industries to spur hiring as they seek to transition the economy away from slower mining investment and extend almost 24 years of growth.
Core inflation is proving "stickier" and leaves the "annual rate close to the center of the RBA's target range," Stephen Walters, Sydney-based chief economist at JPMorgan Chase & Co, said in a research report before the release. The extent of any downward pressure on the cash rate "will be dictated by how inflation is traveling relative to the assumed path," he said.