The Reserve Bank of Australia (RBA) is keeping a close eye on the upcoming December quarter inflation report, which is set to be released on January 28. This report is crucial as it arrives just days before the RBA’s board meeting scheduled for February 2-3.

Economic analyst Holden noted that while market services prices have not increased, they remain stubbornly high at around 3 percent. This persistent inflationary pressure may lead the RBA to consider an interest rate hike, which Holden suggests is still a possibility.

Holden believes that the inflation data from the December quarter will serve as a more accurate indicator for the RBA’s decisions during their February meeting.

Australian Treasurer Jim Chalmers expressed his approval of the latest Consumer Price Index (CPI) data, which exceeded economists’ expectations. He acknowledged the ongoing financial challenges facing Australians, yet described the CPI results as “very welcome and very encouraging.”

He said the December quarter CPI figures will be a better predictor for the RBA’s February meeting.

Treasurer Jim Chalmers welcomes the CPI data, which was better than economists predicted. Source: AAP / Lukas Coch

Treasurer Jim Chalmers said while he understood Australians were still feeling the pinch of competing costs, the CPI results were “very welcome and very encouraging”.

— With additional reporting by the Australian Associated Press.