Inflation dominates the coming week’s schedule of economic statistics. Meanwhile in the US, there is a raft of data releases including home prices and economic growth.
The week begins in Australia on Monday with the release of the quarterly State of the States report from CommSec. The report analyses the relative economic performance of state and territory economies.
On Wednesday in Australia, the Australian Bureau of Statistics releases the quarterly Consumer Price Index – the main measure of inflation used in Australia. And for the first time in 2½ years the annual headline rate of inflation is expected to be back in the Reserve Bank’s 2-3 per cent target zone. We expect that prices rose by around 0.6 per cent in the March quarter, lifting the annual rate of inflation from 1.5 per cent to 2.3 per cent. Stripping out the volatile elements, the “underlying” CPI is expected to lift by around 0.5 per cent in the quarter and 1.8 per cent over the year – getting closer to the 2-3 per cent band
One of the biggest drivers of the result is likely to be petrol, up around 6 per cent and adding almost 0.2 percentage points to the quarterly lift in the CPI. Seasonal increases in education fees and pharmaceuticals are offset by seasonal declines in holiday travel & accommodation, alcohol & tobacco and clothing.
Originally published by Savanth Sebastian, Senior Economist, CommSec