Higher than expected inflation figures have economists scrambling to adjust their forecasts of the next Reserve Bank interest rate rise.
After what seems like an eternity there are signs of life from the nation’s inflation figures and it could mean interest rates start heading north.
After solid unemployment figures recently, surprise rises in inflation has snuffed out the likelihood of a Reserve Bank rate cut next week.
Weak inflation figures have blown the chance for an interest rate cut in May wide open, according to JP Morgan’s Sally Auld. Speaking to The
The economy looks set for another interest rate cut next month with inflation having eased to 1.3 per cent in the March quarter.
RBA deputy governor Ric Battellino has commented that the Reserve Bank board has had to balance higher-than-anticipated inflation with slowed economic growth. Battellino said inflation for 2011 is likely to trend higher than was forecast last year, while growth estimates have had to be revised downward amid global economic uncertainty and this year’s natural disasters.