Australia's high inflation may trigger interest rate hikes
By C.J. Perrin | April 28, 2011 1:04 AM EST
The higher-than-expected inflation rates in Australia gives the central bank more reason to increase interest rates, analysts said.
The upward trend taken by consumer prices is most evident in food and petrol prices, according to the latest government data published by the Australian Bureau of Statistics today.
The rise in Australia's consumer prices also had an impact on the value of the Aussie dollar against the US greenback.
The Australian dollar strengthened to a record after a government report showed consumer prices increased by the most in five years, giving the central bank more reason to raise benchmark rates.
The Australian dollar climbed to $1.0833 as of 4:03 p.m. in Sydney from $1.0785 in New York yesterday, after rising to $1.0852, the strongest since it was freely floated in 1983. New Zealand's dollar traded at 80.59 U.S. cents from 80.57 cents, after reaching 81.08, the highest since March 2008. The currency appreciated 0.2 percent to 65.83 yen.
Australian consumer prices jumped in the first quarter as the country coped with the lingering impact of the summer's floods pushed up food costs and petroleum prices went up with the extent of the Middle East unrest.
Among Australia's capital cities, the highest recorded consumer prices had been in Melbourne.
The country's consumer price index rose 1.6 percent in the March quarter - its largest quarterly jump in almost five years.
From a year earlier, Australia's inflation rate was 3.3 percent higher, the Australian Bureau of Statistics reported. The results also beat analysts' forecasts of 3 percent for the period.
More from IBT Markets:
Newsletter: To receive Global Markets update, sign up here
To contact the editor, e-mail:
Join the Conversation
- Israel''s Al Aqsa and East Jerusalem Issues Threatening Its Multi Billion Gas Deal With Jordan
- Eurozone Indicators Forewarn Imminent Recession: Germany's Manufacturing Sector Slows
- Prince Charles to Reshape Monarchy When He Becomes King – Report
- Andrew Robb Asks Obama Not to ‘Lecture’ Australia on Climate Change
- China Is Building An Island In The Spratly Islands—Report
- Russia's New Tactical Nuclear Weapons Program Growing Confident Against the US: Talks of World War III
- Apple and Google Engage in Thermonuclear War, New Google Translate Chat App in the Works
- Walmart Offers the Best 2014 Black Friday Deals on iPhone 6, iPad Ai2 & Other Gadgets – Reports
- Update Samsung Galaxy S5 to Android 4.4.4 KitKat, Sprint Release and Installation
- More Nexus 6 Problems Arise with Android 5.0 Lollipop, Poor Benchmark Results and Other Issues
- Highest Paid NBA Players 2014: NBA Stars Who Earn More Than LeBron James
- HTC One M8 Android 5.0 Lollipop Release Delayed: Other Schedule and Installation Guide