Inflation in free fall - RBA desperately needs to cut rates With the December quarter inflation data out of the way, the only thing standing in the way of an...

Stephen Koukoulas

Market Economics Pty Ltd

Inflation in free fall - RBA desperately needs to cut rates With the December quarter inflation data out of the way, the only thing standing in the way of an interest rate cut at next week's RBA Board meeting is its own pig-headedness and its crazed obsession with Sydney house prices. The December quarter CPI confirmed a further marked fall in inflation - the headline rate fell to just 1.7 per cent, the lowest annual reading since March 2012, and the quarterly momentum pointing to yet lower inflation in the next quarter or two. It was below the market forecast. it is only the fifth time since 2000 (that's 56 quarters) that inflation has been below 2 per cent. The underlying measures were also soft, with the annual increase at just 2.2 per cent, well down on the 2.8 per cent recorded in the June quarter 2014 and spot on the market forecast. Whichever way the CPI data are cut and diced, inflation is low. To read the full article, click here: (VIEW LINK)


Stephen Koukoulas
Chief Economist
Market Economics Pty Ltd

Stephen Koukoulas has a rare and specialised professional experience over more than 25 years as an economist in government, as Global Head of economic and market research, a Chief Economist for two major banks and as economic advisor to the Prime...

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