Inflation expectations increasing, but no rate rise coming

Advertisement

Roy Morgan has released its Inflation Expectations report for July, which increased to 4.1% – the highest reading since October 2019:

In July 2021 Australians expected inflation of 4.1% annually over the next two years, up 0.1% and the highest Inflation Expectations for nearly two years since October 2019. Inflation Expectations are now up 0.9% points since the pandemic low of 3.2% a year ago in August 2020.

Inflation Expectations are still 0.6% points below their long-term average of 4.7% but are now 0.6% points higher than the 2020 monthly average of 3.5% and 0.7% points higher than a year ago in July 2020 (3.4%).

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:
Cancel at any time through our billing provider, Stripe
About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.