Live Chat

Australia inflation rate ticks up to 3.6% in April

Australia inflation rate hotter-than-expected at 3.6% in April

The Australian inflation rate unexpectedly ticked up in April, sending a further warning to the country’s central bank to remain vigilant, while justifying its recent decision to put the possibility of another interest rate hike back on the table.

In response to the inflation data, money markets are now pricing in only two basis points of rate cuts by the Reserve Bank of Australia (RBA) by the end of the year. Probabilities of interest rate hikes are also back up.

Markets.com Chief Market Analyst Neil Wilson mentioned the market’s reaction to a higher Australia inflation rate in his week ahead preview:

“Australian inflation has come down a lot but remains stubborn – CPI fell to 3.6% in Q1 2024 from the previous 4.1% but was above the market consensus of 3.4%. QoQ rose 1.0% vs 0.6% in the prior quarter.

RBA meeting minutes showed policymakers considered raising rates as the flow of data since the previous meeting had ‘mostly been stronger than expected’, and that it was 'difficult either to rule in or rule out future changes’ to rates’, though it stopped short of adopting a tightening bias. Any acceleration in the rate of inflation could see rate hikes come back on the table”.

Choose your points of movement

Сalculate your hypothetical P/L (aggregated cost and charges) if you had opened a trade today.

Market

Currency Search
Currency
Index
Shares
ETFs
Bonds
Crypto
Commodity

Instrument

Search
Clear input
Occidental
Siemens
Morgan Stanley
GSX Techedu
Marston's
Alibaba
Skillz Inc
Macy's
Lemonade
Lululemon
Plug Power
Amazon.com
Verizon
Thermo Fisher
Mondelez
General Motors
LVMH
IAG
Cinemark
PETROCHINA
Royal Bank Canada
Anglo American
F5 Networks
Nikola Corporation
Zoom Video Communications
Air France-KLM
Comcast
UniCredit
The Cheesecake Factory
Barrick Gold
Bayer
Toro
Kuaishou
Gen Digital Inc
Tilray
Xiaomi
SMCI
Wish.com Inc
Adobe
DISNEY
Coinbase Inc
UiPath Inc
T-Mobile
Rio Tinto
Schlumberger
Invesco Mortgage
Hammerson
Volkswagen
Sartorius AG
ROBLOX Corp
ChargePoint Holdings Inc
UPS
Pinterest Inc
Continental
Jumia Technologies
Medtronic
PayPal
Twilio
Freeport McMoRan
UnitedHealth
SIG
Tesla
Lyft
Boeing Co
Annaly Capital
Santander
Teladoc
Li Auto
CrowdStrike Holdings
Deere
Fedex
Naspers
ProSiebenSat.1
Bilibili Inc
Costco
New Oriental
NVIDIA
Iberdrola
Gilead
American Express
Apple
Airbus
GoPro
Chevron
HSBC HK
Two Harbors Investment aration
easyJet
Inditex
BlackBerry
Anheuser-Busch Inbev
Deliveroo Holdings
Hubspot
Applied Materials
GameStop
British American Tobacco
Trade Desk
McDonald's
AMC Entertainment Holdings
Adidas
AIA
Bristol Myers
Novavax
TUI
Fresnillo
Shell plc (LSE)
Nasdaq
Ceconomy
Lithium Americas Corp
Rivian Automotive
Qorvo
MercadoLibre.com
Coca-Cola Co (NYSE)
HDFC Bank
Roku Inc
Infinera
Arista
Total
JnJ
Dave & Buster's
PG&E
ON Semiconductor
Diageo
XPeng Inc
ASML
Vodafone
Airbus Group SE
Campari
Telecom Italia
Glencore plc
HSBC
ZIM Integrated Shipping Services Ltd
Kraft Heinz
Spotify
Aurora Cannabis Inc
Etsy
Goldman Sachs
Norwegian Air Shuttle
Abbott
Snap
Linde PLC
Blackstone
Cellnex
Tencent
Barclays
Virgin Galactic
JP Morgan
Allianz
RTX Corp
Taiwan Semi
Wal-Mart Stores
Intel
DoorDash
Wayfair
SONY
II-VI
Norwegian Cruise Line
BioNTech
Palantir Technologies Inc
CNOOC
Cisco Systems
Electrolux
ALIBABA HK
Robinhood
Vonovia
British American Tobacco
SAP
Ford
Cameco
Peloton Interactive Inc.
Toyota
Amgen
AT&T
Infosys
Starbucks
Lloyds
Qualcomm
Canopy Growth
3D Systems
CarMax
LUCID
Eni
AMD
Target
IBM
FirstRand
Lumentum Holdings
Alphabet (Google)
Workday Inc
ASOS
Conoco Phillips
Moderna Inc
Trump Media & Technology Group
Fuelcell
MerckCo USA
Salesforce.com
Hermes
BASF
AstraZeneca
Christian Dior
Broadcom
Oracle
Vipshop
CCB (Asia)
Nio
Block
Uber
Accenture
Meta (Formerly Facebook)
Berkshire Hathaway
Wells Fargo
Blackrock
Rolls-Royce
Pfizer
Microsoft
Home Depot
Mastercard
Lufthansa
Marriott
AbbVie
China Life
Baidu
Eli Lilly
DeltaAir
Chipotle
BP
General Electric
eBay
Quanta Services
Netflix
Micron
Visa
Golar LNG
ADT
JD.com
American Airlines
Porsche AG
Palo Alto Networks
Teleperformance
Lockheed Martin
Upstart Holdings Inc
Delivery Hero SE
Airbnb Inc
Nel ASA
GoHealth
Shopify
Aptiv PLC
Bank of America
PepsiCo
Philip Morris
Exxon Mobil
Procter & Gamble
Beyond Meat
Snowflake
L'Oreal
Sea
Porsche
Deutsche Bank
Nike
Unilever
CAT
Prosus N.V.
Unity Software
Citigroup
Upwork Inc.
Vir Biotechnology

Account Type

Direction

Quantity

Amount must be equal or higher than

Amount should be less than

Amount should be a multiple of the minimum lots increment

USD Down
$-

Value

$-

Commission

$-

Spread

-

Leverage

-

Conversion Fee

$-

Required Margin

$-

Overnight Swaps

$-
Start Trading

Past performance is not a reliable indicator of future results.

All positions on instruments denominated in a currency that is different from your account currency, will be subject to a conversion fee at the position exit as well.

Australia inflation rate rise driven by housing, transport, food, alcohol, and tobacco

According to the Australian Bureau of Statistics (ABS), the monthly consumer price index (CPI) rose 3.6% in the 12 months to April, up from 3.5% in March. Economists had anticipated a decline to 3.4%.

Michelle Marquardt, ABS head of prices statistics, said in a statement:

“Inflation has been relatively stable over the past five months, although this is the second month in a row where annual inflation has had a small increase”.

Housing, food, alcohol and tobacco, and transport were the primary drivers of the annual inflation rate increase in April.

Harry Murphy Cruise, an economist at Moody’s Analytics cited by the Wall Street Journal (WSJ), said of the Australian inflation rate:

“This is the second straight month where inflation has moved in the wrong direction. Not yet a trend, but a worrying development nonetheless”.

When these volatile items are excluded, the annual inflation rate remains steady at 4.1%.

Tony Sycamore, market analyst at IG Australia, also told the WSJ:

“In this context, today’s print won’t move the dial ahead of the RBA’s board meeting on June 18. However, it will raise questions about the pace and sustainability of inflation decline back towards the target in a time frame that is consistent with the RBA board’s strategy”.

April’s Australia inflation print shifts interest rate expectations

Housing costs increased by 4.9% over the year to April, down from 5.2% in March. Rent prices surged 7.5%, highlighting a tight rental market and low vacancy rates nationwide.

New dwelling prices also rose by 4.9% over the year, as builders passed higher labour and material costs onto consumers. According to the ABS, the annual price growth for new dwellings has been around 5% since August 2023.

Electricity prices saw a 4.2% increase in the 12 months to April. Government energy rebates introduced last July have largely offset these increases. Without the rebates, electricity prices would have surged by 13.9%, the ABS reported.

The Australian dollar, also widely known as the “Aussie” in forex markets, pulled back from $0.6667 as the U.S. dollar rose across the board.

AUDUSD hits 0.6590 amid mixed economic signals but scales back losses

The Australian dollar, also widely known as the “Aussie” in forex markets, pulled back from $0.6667 as the U.S. dollar rose across the board.

AUD dipped to the $0.6590 level after the release of the Australia inflation data but later scaled back its losses. The AUD to USD pair traded at $0.6608 at the time of writing.

The Australian inflation reading for April left markets wondering as to the risk that the Reserve Bank of Australia (RBA) might have to hike rates again.

Futures now imply a 27% chance of a rise in the 4.35% cash rate, up from 14% before the data.

Paul Bloxham, head of Australian economics at HSBC, said that the bank’s base case was for Australian interest rates to remain steady before a cut in the second quarter of 2025:

"The slow disinflation process in Australia has been evident for some time. Despite the slowdown in growth, the supply-side of the economy has been constrained, and productivity has been weak. Our central case is that the RBA's cash rate will be on hold through 2024 with rate cuts not beginning until Q2 2025”.


When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.

Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.

Latest news

Wednesday, 20 November 2024

Indices

MicroStrategy Stock Surges as Bitcoin price rises to fresh record above $94K

Wednesday, 20 November 2024

Indices

Nasdaq futures decline, Nvidia shares dip following the earnings report

Mixed market performance

Wednesday, 20 November 2024

Indices

Markets Mixed Amid Inflation, Tech Rally, and UK Economic Woes

Tuesday, 19 November 2024

Indices

Nvidia shares rallied on AI spending ahead of Nvidia Q3 earnings 2024

Live Chat