Australia’s core consumer prices matched economists’ forecasts in the first three months of the year, providing scope for the central bank to reduce interest rates.
The trimmed mean gauge of core prices advanced 0.6 percent from the previous quarter, the Bureau of Statistics said in Sydney Wednesday, in line with the median forecast. The consumer price index rose 0.2 percent from the prior period, compared with economists’ forecasts for a 0.1 percent increase.
“Australia’s CPI figures aren’t as weak as we expected, but they are unlikely to prompt the RBA to abandon its plans to cut interest rates in early May,” said Paul Dales, chief Australia and New Zealand economist at Capital Economics. “It seems that the boost to inflation from the lower exchange rate is offsetting the drag from weak wage growth and the indirect effects from lower petrol and utility prices.”