Australia: Decent monthly inflation numbers at +0.2%/mth - TDS

Analysts at TDS note that Australia’s November monthly inflation numbers were decent at +0.2%/mth and +2.7%/yr for headline, and +0.2% and +2.6% for the trimmed mean.

Key Quotes

“The next inflation report will be released 31 Jan, where we will see if there finally is a “two-handle” on underlying inflation. With two months of the monthly inflation report, we see both domestic and tradable inflation creeping higher, for overall headline CPI of +0.8%/qtr and +2.1%/yr, and trimmed mean picking up to +2%/yr (after the downside surprise of +1.88%/yr in Q3).”

“Q3 inventories +0.2%/qtr (TD and mkt flat) which may add marginally to GDP, but not an upside shock, and we need to see tomorrow’s net exports and government spending to firm up our +0.7%/qtr GDP f/c.  Q3 company profits –0.2%/qtr (mkt +0.1%)  following the terms of trade lower.”