Australia’s April CPI will be released next Wednesday, 27 May.
Lower fuel prices because of the cut to fuel excise and free public transport in Victoria and Tasmania will have weighed on headline inflation in April. Higher private health insurance premiums will have contributed to inflation.
While the April CPI will provide an early gauge of pass-through from cost increases related to the Middle East conflict, we think most pass-through will occur from May onwards.
Nevertheless, the extent to which home builders started passing through higher material costs to their prices is a key uncertainty. Holiday travel inflation is also very uncertain. April is typically a strong month but rising jet fuel prices and strong demand for some international routes may present upside risk to our nowcasts.
