At a conference today, RBA Chief Economist Sarah Hunter highlighted the central bank’s intense focus on inflation, which continues to exceed the target band.
Discussing the latest CPI data, Hunter noted, “Yesterday’s data did confirm that there’s still strength in a number of categories that we’ve seen up until this point that’s still there.” The latest CPI figures, which show a slight increase from 3.5% to 3.6% in April, underline ongoing inflationary pressures across various sectors.
“So clearly there’s still some strength in inflation, and that’s a key consideration for the board in their decision-making,” Hunter added.
While wage growth appears to have peaked, Hunter expressed concerns about productivity which remains weak: “We can see some components of wages growth coming off already, particularly individual agreements,” she said. However, she also pointed out, “But equally, we are seeing that there’s a bit of a productivity challenge over the last few years.”
