The quarterly CPI was released yesterday and it came out lower than expected again.
Annual inflation is 2.4%. The trimmed mean is 3.2% and in six month annualised terms it is 2.7%.
The trend is down and stil lgoing down. All the business surveys confirm this.
For too long the RBA have been concerned about a tight labour market. Wages are not a problem.
They need to cut rates now.
This also confirms Bulloch was the wrong choice. If Lowe had to be replaced then his deputy made no sense and unfortunately experience tells us the RBA is making the same mistakes they did when Lowe was in charge! THE RBA needed a modern Bernie Fraser.
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