AUD: CPI impact was lost in the noise - TDS

Research Team at TDS notes that the Australia’s December quarter underlying inflation came at 1.55%/yr was perceived as softer than expected and the AUD dipped, but USD fluctuations took over and the CPI impact was lost in the noise.

Key Quotes

“Next week’s Dec qtr reports will firm up our tracking for Dec qtr GDP. While no one expects consecutive negative prints, the extent of the rebound remains unclear.”

“Dec qtr terms of trade soared +12.2%/qtr, eventually boosting incomes, wages and inflation after the slow downside grind from 2011 to 2016.”