What happened
Australia's headline Consumer Price Index rose 4.0% year-on-year in August, coming in below economist expectations of 4.1%. Monthly headline inflation slowed to 0.4% from 1.0% in July, while monthly trimmed mean CPI rose 0.2%. Following the release, the S&P/ASX 200 index gained 75 points or 0.89%, reaching a near three-week high as local bond yields fell across the curve.
Why it matters here
For Australian investors, cooler monthly inflation offers relief after the Reserve Bank of Australia delivered a quarter-point rate hike to 4.60% earlier in the week. Easing price pressures reduce the immediate probability of another rate rise in November, supporting rate-sensitive sectors such as real estate investment trusts, retail stocks, and telecommunications companies.
What to watch
Upcoming economic data including quarterly official CPI releases, trade figures, and employment reports ahead of the RBA's next monetary policy meeting.
Source
marketindex.com.au