Continuous rate cuts are bearing fruit, and while Australia’s CPI has improved, there will be further rate cuts if personal consumption does not improve! [From YEN Kura’s newsletter]
From the investment email newsletter "Real Top Trading" by YEN Kura from GogoJungle, here is a portion from today's distribution.
There was an Australian CPI release today. CPI rose 0.6% quarter-on-quarter and 1.6% year-on-year, beating expectations of 0.5% and 1.5%, rising from 0% and 1.3% in March. In March, with those figures at 0% and 1.3%, the RBA likely hurried to cut rates in June and July. Since March there has been considerable improvement, so there is a possibility that rate cuts may end. However, because the trimmed mean CPI that the RBA emphasizes was 0.4% quarter-on-quarter and 1.6% year-on-year, well below the target annual rate of 2–3%, the expectation of a cut in August has shifted, but November fully embeds a 0.25% cut. If there is no bottoming in the housing market or signs of personal consumption improving due to income tax cuts, another rate cut next year is possible. Last week Westpac forecast two cuts this year, but that may be unlikely.
YEN Kura's Real-Time Newsletter "Real Top Trading" (Dake Tsugara)quoted.
With Australia's CPI exceeding expectations, YEN Kura suggests there is a possibility to temporarily stop rate cuts. On the other hand, further cuts are also expected. Fundamentals analysis seems to be important. (Editorial Department)
