Budget day: Helping or hindering the inflation battle?

Tuesday 14th May 2024

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It is of course, budget day in Australia today. NAB’s Rodrigo Catril says government subsidies will help bring headline inflation down, but the rise in household spending could delay the slowdown in the underlying inflation rate. The speed at which inflation will fall continues to be the question on everyone’s lips around the world. For the US the PPI (producer prices index) will be watched keenly because it feeds through directly to the Fed’s preferred inflation measure. CPI numbers tomorrow will add to the picture. The UK’s employment and wages data today will show whether the upside surprise in GDP in the last quarter is being reflected in the labour market, which could also delay the slowdown in inflation.

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