Annual inflation at 1.5 pc comes in weaker than expected, dollar slumps

Consumer price index The fuel and power sector recorded an overall cost decrease of 2.3 per cent between October and November impacted by a 6.9 per cent decline in the fuel adjustment rate

The combination of currency strength and continued low inflation will keep the possibility of a further RBA rate cut on the table, although the RBA now remains comfortable to leave its policy stance unchanged limiting downside risk for the Aussie in the near-term.

The headline rate was also 1.5 per cent, marking the ninth consecutive quarter the annual rate has been below the bank's target band of 2 to 3 per cent.

"The Reserve Bank doesn't need to cut rates again with inflation trending higher, and there are doubts that rate cuts would actually do much in terms of driving the economy and lifting inflation". "Household price inflation is up from a historical low of 0.1% for the December 2015 year".

Women's March being held in St. Louis, other cities on Saturday
In Massachusetts, demonstrations are also planned for Falmouth, Greenfield, Nantucket, Provincetown, Northampton, and Pittsfield. The faculty notification about the march stresses that "people of all colors and identities are invited".

The consumer price index rose 0.5 per cent in the December quarter for an annual rate of 1.5 per cent, just below economists' expectations and remaining comfortably under the central bank's two to three per cent target band.

"We continue to expect the Reserve Bank to leave the OCR on hold for the foreseeable future", Tuffley said. The average of RBA's two core inflation measures has remained at around 1.6% throughout past year.

Today's data show prices for new housing rose 1.4% in the December quarter for an annual increase of 6.5%, the biggest yearly gain since September 2005.

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The news comes three months after the elaborate Mosul offensive against the Daesh stronghold was launched. Iraqi troops are now on the eastern bank of the Tigris River which splits the city to east and west.

Dragging the index down was a 2.6 per cent fall in the prices of global holiday travel and accommodation in the quarter, a 5.1 per cent fall in the price of clothing accessories and a 3.2 per cent fall in the price of non-alcoholic beverages.

The New Zealand dollar rose to 73.03USc from 72.70USc immediately before the data was released. "Offsetting these rises are price falls for salad vegetables, tomatoes, lettuce and celery", the Bureau noted.

So bottom line, no impact on monetary policy ahead of the RBA's first meeting of the year on February 10.

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