Electric shock
Monthly inflation data came in hot due to a spike in electricity prices. That has spooked some economists, but not the markets, and it's unlikely to sway the RBA.
Economists were quick to label today’s monthly inflation indicator anything from a “shocker” and a "speed bump" to a “complication” for the much-predicted interest rate cut in November.
For those who aren’t across the minutiae, the monthly CPI indicator headline figure of 2.9% in the 12 months to July did indeed knock out of the park the 2.3% consensus expectation.
Betashares chief economist David Bassanese was one of the first out of the gate with a note saying the “biggest disappointment” is the annual trimmed inflation figure rebounding to an “ugly” 2.7% in July, from 2.1% in June.
"The immediate monetary policy implication is to likely remove any chance of an RBA interest rate cut at the September policy meeting," he said.
