Australian Core Inflation Near 8-Year Peak in Major Shock

Australian core inflation accelerated to its fastest annual pace since 2014 in the December quarter as fuel and housing costs led broad-based price pressures, a shock that will stoke market speculation of an early hike in interest rates.

Data from the Australian Bureau of Statistics released on Tuesday showed the headline consumer price index (CPI) rose 1.3% in the fourth quarter and 3.5% for the year, above forecasts.

The trimmed mean measure of core inflation favoured by the Reserve Bank of Australia (RBA) jumped to 1.0% in the quarter, above forecasts of 0.7%. The annual pace picked up to 2.6%, above the 2.3% forecast and atop the middle of the RBA’s 2% to 3% target range.

Reuters with additional editing by Jim Pollard

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Tags: Australia Core Inflation

Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.