Inflation to slow

Inflation to slow

by 0 comments

Staff Reporter

Inflation is expected to fall in August to sit within the RBA’s target range, strengthening economists’ forecasts that the RBA will keep a hold on the cash rate until the end of the year.

According to the Melbourne Institute Survey of Consumer Inflationary Expectations, released yesterday, the median expected inflation rate decreased from 3.3 per cent in July to 2.8 per cent in August.

In addition, the proportion of consumers expecting inflation to be within the RBA’s 2 to 3 per cent band has fallen slightly from 19.1 per cent in July to 18.9 per cent in August.

Melbourne Institute research fellow Dr Michael Chua said this month’s inflationary expectations reflected a weaker than expected June Consumer Price Index (CPI).

“The number of respondents expecting inflation to rise has decreased from 78.9 per cent in July to 73.5 per cent in August, conversely the number of people expecting inflation to stay the same, has risen to 16.6 per cent from 11.4 per cent,” he said.

The CPI expectations were accompanied by the news yesterday that unemployment moved upwards in in July for the first time in five months.

The surprise lift saw the unemployment rate move to 5.3 per cent, from 5.1 per cent in June, adding to expectations for the official cash rate to stay on hold next month.

Many banks have tipped that rates will stay on hold until the end of 2010, including Westpac and NAB.

Staff Reporter

Inflation is expected to fall in August to sit within the RBA’s target range, strengthening economists’ forecasts that the RBA will keep a hold on the cash rate until the end of the year.

According to the Melbourne Institute Survey of Consumer Inflationary Expectations, released yesterday, the median expected inflation rate decreased from 3.3 per cent in July to 2.8 per cent in August.

In addition, the proportion of consumers expecting inflation to be within the RBA’s 2 to 3 per cent band has fallen slightly from 19.1 per cent in July to 18.9 per cent in August.

Melbourne Institute research fellow Dr Michael Chua said this month’s inflationary expectations reflected a weaker than expected June Consumer Price Index (CPI).

“The number of respondents expecting inflation to rise has decreased from 78.9 per cent in July to 73.5 per cent in August, conversely the number of people expecting inflation to stay the same, has risen to 16.6 per cent from 11.4 per cent,” he said.

The CPI expectations were accompanied by the news yesterday that unemployment moved upwards in in July for the first time in five months.

The surprise lift saw the unemployment rate move to 5.3 per cent, from 5.1 per cent in June, adding to expectations for the official cash rate to stay on hold next month.

Many banks have tipped that rates will stay on hold until the end of 2010, including Westpac and NAB.

promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2017

With a combined sales volume of over $14 billion in 2017, the Top 100 Agents ranking represents the very best sales agents in Australia. Find out what sets them apart and learn their secrets to success.

featured podcast

featured podcast
Marnie Seinor on structure, database DNA and connecting with her local community

There’s no such thing as an “off switch” in real estate – so says McGrath agent Marnie Seinor, who came in at number 78 in this year...

View all podcasts

Does blogging help in growing your personal brand?

Yes
No
Depends on who is writing it
Depends on who is reading it
Do you have an industry update?