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AUSTRALIA 
Inflation blows out to 4.5 per cent
Wednesday, 23 July, 2008
Australia’s flexible currency is helping shield it from the US economic fallout (AAP)
Inflation pressures accelerated during the three months to June lifting the annual inflation rate to 4.5 per cent well outside the Reserve Bank's target band.
However economists say the central bank is unlikely to raise interest rates again on the back of the latest consumer price index figure.
The Reserve's been talking down the risk of another inflation-induced rise in interest rates in recent months, saying there are signs the economy is slowing.
The CPI surged 1.5 per cent in the June quarter, lifting the annual rate to 4.5 per cent, well outside the RBA's inflation target of between two and three per cent.
More importantly the Reserve's preferred measures of underlying inflation rose by an average 1.1 per cent in the three months to June after jumping 1.25 per cent in the previous quarter.
The average annual rate for these measures was 4.4 per cent at the end of June compared with 4.25 per cent in the year to March.
This was in line with economists' forecasts.
Source: AAP
However economists say the central bank is unlikely to raise interest rates again on the back of the latest consumer price index figure.
The Reserve's been talking down the risk of another inflation-induced rise in interest rates in recent months, saying there are signs the economy is slowing.
The CPI surged 1.5 per cent in the June quarter, lifting the annual rate to 4.5 per cent, well outside the RBA's inflation target of between two and three per cent.
More importantly the Reserve's preferred measures of underlying inflation rose by an average 1.1 per cent in the three months to June after jumping 1.25 per cent in the previous quarter.
The average annual rate for these measures was 4.4 per cent at the end of June compared with 4.25 per cent in the year to March.
This was in line with economists' forecasts.
Source: AAP
