Australia cuts core inflation forecast

Sydney

AUSTRALIA's central bank forecast core inflation is unlikely to reach the bottom of its target this year and will probably only do so in the ensuing two years as the developed-world disinflation quandary emerges Down Under.

The central bank, in its quarterly statement Friday, left estimated economic growth at 2.5 per cent to 3.5 per cent this year and next and predicted unemployment will remain around the current 5.7 per cent. It gave no guidance on the interest-rate outlook after cutting to a fresh record of 1.75 per cent this week.