Markets expect annual inflation to ease in July, with trimmed mean CPI also softening ahead of the RBA’s next policy decision.
Australia’s July Consumer Price Index is forecast to rise 3.2% year-over-year, down from June’s 3.8%, signaling a potential easing in inflation pressures. The monthly CPI is expected to rebound to 0.8% after a -0.1% decline in June, while the trimmed mean CPI, the RBA’s preferred measure, is seen dipping to 3.5% annually from 3.6%.
The Reserve Bank of Australia has closely monitored inflation trends, with recent prints influencing its hawkish stance. Global factors, including Middle East tensions and energy prices, continue to pose risks to inflation stability. The AUD/USD pair remains near multi-month highs, reflecting broader USD weakness amid geopolitical uncertainty.
Traders will scrutinize the data for clues on the RBA’s next move, with markets pricing in potential rate adjustments based on inflation persistence or further cooling.