The TD – MI monthly inflation gauge is the most timely read of inflationary pressures in the Australian economy. At the moment however it continues to show that inflation in the economy is low, with a rise of just 0.1% in November for a year-on-year increase to 2.2%.
“Contributing to the overall change in November were price rises for fruit and vegetables (+4.3 per cent), newspapers, books and stationery (+4.1 per cent), and garments (+1.9 per cent).
These were offset by falls in automotive fuel (-5.2 per cent), holiday travel and accommodation (-1.6 per cent), and games, toys and hobbies (-8.7 per cent).”
If ever there’s a set of relative price moves which could set up a solid Christmas for retailers this is it. Annette Beacher, TD Securities Head of Asia-Pacific research told the ABC that the fall in petrol prices was like a weekly tax cut.
She said low inflation would add to a statement from the RBA after tomorrow’s Board meeting which would once again emphasise, “that it is prudent that there be a period of stability in interest rates.”