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Inflation

Yesterday

Trump is likely to be dead serious about tariffs.

Trump isn’t bluffing on tariffs. He desperately needs cash

Don’t believe the “hopeium” that Donald Trump is bluffing on tariffs.

  • Christopher Joye
Anthony Albanese’s election timing will be influenced by Michele Bullock’s decision.

Why an RBA rate cut (which is 50/50) may trigger an early election

Bond traders reckon there’s a 90 per cent chance of an interest rate cut on Tuesday. In reality, it’s a coin toss and if the RBA does cut, don’t expect more anytime soon. All that adds up to an early election.

  • John Kehoe
Donald Trump’s arrival has coincided with important but subtle shifts in market beliefs.

Three ways to reposition your portfolio for shifting markets

Beneath the drama of Donald Trump’s second coming, the most dearly held beliefs that have delivered huge returns to investors are suddenly being challenged. 

  • Updated
  • James Thomson

This Month

Financial markets are overstating the probability of a rate cut at next week’s RBA board meeting.

Inflation has smashed profits, so a rate cut is no sure bet

Businesses have absorbed some cost increases through lower profitability. But that may soon change and could stall further progress towards the RBA’s inflation target.

  • Paul Brennan
The balancing act isn’t getting any easier for Reserve Bank governor Michele Bullock.

Sticky US inflation just made the RBA’s cut call harder

Four months after the Fed cut rates, inflationary pressures appear to be building in the US. The lesson is unlikely to be lost on the Reserve Bank.

  • Updated
  • James Thomson
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Chemist Warehouse shares rise on debut; EY to slash jobs; Rate cut call just got harder

Read everything that’s happened in the news so far today.

US Federal Reserve chairman Jerome Powell speaks during a Senate hearing.

US CPI data points to prolonged rate hold: economists

Consumer prices rose at a faster pace than expected last month, and the probability of rate cuts by the Federal Reserve has fallen, economists and strategists say.

  • Timothy Moore

US inflation rises broadly, further denting rate cut prospects

Higher prices for car insurance, airfares and a record monthly increase in the cost of prescription drugs paced the rise in core prices.

  • Augusta Saraiva
Trump’s policy shocks need to be carefully thought through.

Investors should beware Trumping at shadows over tariffs

Be careful of buying or selling the rumour around the president’s policies before seeing the facts. Beware fake news.

  • James Thomson
Elon Musk has become one of the most powerful figures in the new administration.

Musk’s DOGE madness could actually move markets. Here’s how

Elon Musk’s controversial Department of Government Efficiency is creating plenty of noise. Some in markets are starting to ask: what if it actually works?

  • James Thomson
Donald Trump’s policies are expected to stoke inflation, but the market should be worried about liquidity instead.

Ignore what market says on rates and buy these assets instead

Traders are still pricing in less than half a percentage point of US interest rate cuts for 2025, but that assumption is flawed.

  • Vimal Gor
The Bank of England is hoping for a soft landing for the UK economy.

Bank of England cuts key UK interest rate to 4.5pc

The latest reduction reflects some concern about the outlook for the British economy, which has barely grown over the past six months.

  • Philip Aldrick, Tom Rees and Greg Ritchie
Jo Masters at Barrenjoey says Trump tariffs are heightening uncertainty.

These five economists make a bold prediction on next rate cut

Analysts at Barrenjoey, Deloitte, KPMG, Judo Bank and Oxford Economics are tipping that the Reserve Bank will keep rates on hold on February 18.

  • Updated
  • Cecile Lefort
Future Fund chief executive Raphael Arndt hasn’t changed his view on the world that investors will confront.

What you can learn from the Future Fund’s three big moves

The Future Fund’s shift into US stock has paid off, but it still fears a Trumpian world of more polarisation and higher inflation. 

  • James Thomson
Paul Bloxham, chief economist at HSBC.

Meet the most accurate economic forecaster of 2024

The Reserve Bank will cut the cash rate, according to Paul Bloxham, but don’t count on a big drop in borrowing costs as this cycle will be a short one.

  • Updated
  • Cecile Lefort
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Paul Bloxham, pictured in Sydney on Monday, loves talking about the economy. Growing up in Perth, he used to be a theatre kid.

Top forecaster Paul Bloxham says trade war changes the RBA path

HSBC’s chief economist says the RBA will only cut twice in 2025, beginning this month, and once in 2026.

  • Cecile Lefort
Donald Trump.

Market panic may be the best protection against Trump’s tariff war

Investors were sure the “Art of the Deal” schtick would mean import duties would be avoided. Now they face a world of “uncontrollable chaos”.

  • James Thomson
Prime Minister Anthony Albanese speaks to the media at the Swinburne Tafe, Croydon.

Voters will be better off under Labor, PM promises – again

Anthony Albanese concedes he hasn’t been able to keep the same pledge he made three years ago, but insists this time will be different.

  • Phillip Coorey
A measure which strips out imputed prices, known as the “market-based” core PCE index, rose 0.1 per cent for a second month and 2.4 per cent from a year earlier.

Key Fed inflation gauge ends 2024 with a muted advance

On a three-month annualised basis – seen as a more accurate picture of the trajectory of inflation – the core PCE price gauge rose 2.2 per cent, the least since July.

  • Matthew Boesler

January

Economists say the tight jobs market and increasing government spending will mean the RBA will deliver just three or four rate cuts in total this year.

RBA rate cuts coming – but don’t expect a windfall

Economists say the tight jobs market and increasing government spending will mean the RBA will deliver just three or four rate cuts in total this year.

  • Michael Read

Original URL: https://www.afr.com/topic/inflation-1mph