প্রকাশ: 27/07/2022
Australian inflation
sped to a 21-year high last quarter and is likely to accelerate even further as
food and energy costs explode, stoking speculation interest rates will need to
more than double to bring the outbreak under control.
Wednesday's gloomy report comes just a day before Treasurer
Jim Chalmers is due to update the previous government's budget forecasts, and
he is already warning that inflation would get worse before it got better.
"It will be confronting," Chalmers told reporters
on the update. "Inflation revised up substantially, growth revised down,
and all of the implications that brings."
Data from the Australian Bureau of Statistics showed the
consumer price index (CPI) jumped 1.8% in the June quarter, just short of
market forecasts of 1.9%.
The annual rate picked up to 6.1% from 5.1%, the highest
since 2001 and more than twice the pace of wage growth.
A closely watched measure of core inflation, the trimmed
mean, rose 1.5% in the quarter, lifting the annual pace to the highest since
the series began in 2003 at 4.9%.
That took core inflation further away from the Reserve Bank
of Australia's (RBA) 2-3% target band and cemented expectations it would hike
the 1.35% cash rate by 50 basis points at a policy meeting on Aug. 2.
Markets are leaning against an RBA move of 75 basis points,
though the US Federal Reserve is expected to hike by a similar amount later on
Wednesday.
The RBA, like many central banks, was wrongfooted by the
rapid pick-up in inflation and has already had to raise rates three times, the
most aggressive tightening in decades.
A NARROW PATH
That is one reason Australia's recently elected Labor
government has launched an independent review of the RBA to see if its policies
and governance needed updating.
RBA Governor Philip Lowe has indicated rates will likely
keep rising toward a "neutral" level of at least 2.5%, while markets
have priced in as much as 3.75%.
"The challenge now is calibrating the amount of
tightening that will be needed," said Paul Bloxham, head of Australian
economics at HSBC, noting "neutral" was a moving target and tough to
hit in practice.
"Going too hard from here may deliver a recession - too
little, a persistent inflation problem," he warned. "A narrow pathway
indeed."
The challenge is all the greater as much of the inflation
pulse is global and beyond the RBA's control. The CPI measure of petrol prices
hit a record peak for the fourth straight quarter, while supply chain problems
and rising shipping costs saw goods inflation reach the highest since 1987.
While petrol has eased in recent weeks, market disruptions
are boosting the cost of electricity and gas, while widespread flooding has lifted
prices for fresh food.
As a result, analysts fear CPI inflation could well top 7%,
or even 8%, by the end of the year and risk becoming embedded in wage and price
expectations.
Alarmingly, an ANZ survey out this week showed consumers now
expected inflation to run at 6% over the next two years.
Market measures of future inflation are more contained, with
bond yields clearly signaling an economic slowdown ahead but, as yet, no
recession.
- Reuters
প্রধান সম্পাদকঃ সৈয়দ বোরহান কবীর
ক্রিয়েটিভ মিডিয়া লিমিটেডের অঙ্গ প্রতিষ্ঠান
বার্তা এবং বাণিজ্যিক কার্যালয়ঃ ২/৩ , ব্লক - ডি , লালমাটিয়া , ঢাকা -১২০৭
নিবন্ধিত ঠিকানাঃ বাড়ি# ৪৩ (লেভেল-৫) , রোড#১৬ নতুন (পুরাতন ২৭) , ধানমন্ডি , ঢাকা- ১২০৯
ফোনঃ +৮৮-০২৯১২৩৬৭৭