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Australia's Q1 inflation shockingly low, RBA rate cut in the cards

Australia's Q1 2016 CPI reads surprised to the downside, which now strengthens the case for the RBA to potentially cut rates in coming months.

Main headlines

Australia RBA trimmed mean CPI (QoQ) came at 0.2% vs +0.5% and +0.6% last

Australia RBA trimmed mean CPI (YoY) stood at 1.7% vs 2% exp and 2.1 last.

Australia Consumer Price Index (QoQ) came in at -0.2% vs 0.2% exp and +0.4% last

Australia Consumer Price Index (YoY) came at 1.3% vs 1.7% exp and 1.7% last

Key points Q1 2016

THE ALL GROUPS CPI: fell 0.2% this quarter, compared with a rise of 0.4% last quarter. rose 1.3% over the twelve months to the March quarter 2016, compared with a rise of 1.7% over the twelve months to the December quarter 2015.

OVERVIEW OF CPI MOVEMENTS: The most significant price falls this quarter are automotive fuel (-10.0%), fruit (-11.1%) and international holiday travel and accommodation (-2.0%). The most significant offsetting price rises this quarter are secondary education (+4.6%), medical and hospital services (+1.6%) and pharmaceutical products (+4.8%).

Australia Consumer Price Index (YoY) came in at 1.3% below forecasts (1.8%) in 1Q

Australia Consumer Price Index (YoY) came in at 1.3% below forecasts (1.8%) in 1Q
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AUD/USD crashes 1 big figure on Aus CPI shocker

The AUD/USD pair plummeted almost 100-pips in an immediate reaction to the Australian CPI report, which surprised markets to the downside.
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