IMF forecasts Australian CPI stays above 3% through 2025 – highest inflation in the world*

Adam posted on the IMF’s World Economic Outlook on Tuesday:

• IMF boosts US growth forecasts, trims China and Germany

But, it falls to me to add the info for Australia. And its not good:

• forecast 3.6% inflation for 2025, up from 2.8% in their previous forecast back in April

Sees inflation to 3% in December, citing relief via government cost-of-living payments, But, these subsidies will run out by the end of 2025.

The Reserve Bank of Australia target band is 2 to 3% (in a nutshell). If the IMF are correct it’s difficult to see rate cuts from the Bank. Local analysts are tipping cuts from the Bank as soon as December (Commonwealth Bank of Australia), but Q1 to H1 next year is the more consensus estimate.

This article was written by Eamonn Sheridan at www.forexlive.com.