SYDNEY: Australian consumer prices rose by less than forecast in the third quarter, climbing by 0.5% compared with the 0.7% increase economists were expecting.
Consumer prices also rose by 1.5% on-year, compared with an expected 1.8% rise, the Australian Bureau of Statistics said Wednesday. The Reserve Bank of Australia targets an inflation rate of between 2% and 3%.
The Australian dollar weakened sharply on the benign data, dropping by close to 1 U.S. cent as traders bet on a higher chance of an imminent interest-rate cut. Core inflation rose by an average of 0.3% in the quarter, compared with the 0.5% increase expected by economists.
The main contributors to the rise in consumer prices were international holiday travel and accommodation and the cost of fruits and property, offset by falls in prices for vegetables, telecommunications and fuel.
