Australian inflation for the December quarter has come in below market expectations, printing at 0.2% for the quarter and 1.7% for the year.
The market had forecast just above that level, with 0.3% for the quarter and 1.8% for the year.
The bulk of the low headline number was driven by lower fuel prices.
The weighted median, however, was 0.7% for the quarter and 2.3% for the year – a bit hotter than some expected. The trimmed mean was 0.7% and 2.2%, in line with expectations. The Aussie dollar has risen sharply against the US dollar on the data. Here’s the chart:
It’s a judgment by the market that the RBA has time to wait before cutting interest rates (and there’s probably some traders caught in a short squeeze).