The Australian Bureau of Statistics (ABS) has just released Producer Price Index (PPI) data for the June quarter, which has registered a 0.1% quarterly increase in final (stage 3) prices and an increase of only 1.2% over the year:
The 0.1% increase in final (stage 3) prices was driven primarily by increases in the prices received for building construction (+0.6%), road and bridge construction (+0.6%) and bakery product manufacturing (+3.6%), partly offset by falls in the prices received for motor vehicle and motor vehicle part manufacturing (-1.0%) and other agriculture (-4.1%).
The below chart shows the quarterly change in final PPI by component since 2005:
And below is a time-series of final PPI dating back to the beginning of the series. Note the huge fall in imported costs reflecting the appreciation of the Australian dollar, which could soon begin to increase now that the dollar is depreciating:
Finally, the below chart compares annual changes in the final PPI against the Consumer Price Index (CPI):
Overall, there’s a lack of inflationary pressures across the Australian economy. Although, as noted above, the situation could change in the event that the Australian dollar continues to depreciate, pushing-up imported inflation.
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