Australia's Q1 2017 CPI: Headline misses expectations

Following the sluggishness seen in Australia's Q4 2016 CPI readings, today's inflation figures for the Q1 2017 showed a mixed picture, with the headlines numbers missing expectations. However, the annualized CPI figures reached the highest rate since Sept quarter of 2014, while the core – trimmed CPI came in a tad firmer.

Main headlines

CPI headline q/q +0.5% vs  0.6% exp and 0.5% prior

CPI headline y/y +2.1% vs 2.2% exp and 1.5% prior

RBA trimmed mean +0.5% vs 0.5% exp and 0.4% last

RBA trimmed mean y/y +1.9% vs 1.8% exp and 1.6% last

Q1 KEY FIGURES

Rose 0.5% this quarter, compared with a rise of 0.5% in the December quarter 2016.

Rose 2.1% over the twelve months to the March quarter 2017, compared with a rise of 1.5% over the twelve months to the December quarter 2016.

OVERVIEW OF CPI MOVEMENTS

The most significant price rises this quarter are automotive fuel (+5.7%), new dwelling purchase by owner-occupiers (+1.0%), medical and hospital services (+1.6%) and electricity (+2.5%).

The most significant offsetting price falls this quarter are international holiday travel and accommodation (-3.8%), fruit (-6.7%) and furniture (-3.5%).