AUD: worrisome inflation trends
So much for the inflation dragon being slayed. The Q3 Australian CPI data was a jolt to the system. Headline inflation rose 1.3% in Q3 to be 3.2% higher compared to a year ago, while the trimmed mean (the RBA’s preferred gauge which gives a better guide to inflation persistence) rose 1% in the quarter or 3%pa. Inflation momentum has turned up with 3-month and 6-month annualised run-rates at levels that haven’t been seen since H1 2024 (chart 1). On our figuring a slightly greater share of the CPI basket is also rising by 3%pa or more. The Q3 CPI...