00:01So Lorna, today a whole raft of inflation data was released by the ABS because we still have
00:07the old quarterly series and the new monthly series. So the June quarter series was released
00:13as well as the June monthly series. But on every measure, price growth eased. So price pressures
00:19in the economy are slowing, but they're still growing. So if we look on an annual base and
00:25look at the June monthly numbers, we saw that inflation eased from 4% to 3.8% over the
00:3212
00:32months to June. And when we go to the RBA's preferred measure, the underlying measure,
00:38which is the trimmed mean, it strips out volatile items. It stayed at 3.6%. Now, behind the data in
00:46the year to June, housing was the biggest driver of inflation with electricity prices and new building
00:52costs really pushing costs up for people in our community. Food and non-alcoholic beverages were
01:00also more expensive in the period. Recreation and culture also rose. Fuel prices have come down now
01:07for three straight months. Now, there's been quite a lot of volatility in the global oil prices,
01:12we know, with the Middle East conflict going on. But we did see the fuel excise cut in full
01:18in this period. Of course, we know that has since moderated to half and it runs out on Sunday this
01:25week. What do you think the Reserve Bank will make of it? Well, price pressures are still stronger than
01:31the Reserve Bank would like. We're seeing those numbers well outside of the RBA's target band.
01:36It wants inflation back to the midpoint of its target band at 2.5% as soon as it can
01:44manage it.
01:44It probably does give the Reserve Bank a little bit of breathing room, given this data wasn't as bad
01:52as most economists had expected. We've already had three interest rate increases in the economy this
01:59year, and that has kept the cash rate up to 4.35%. Whether or not we would need a fourth
02:06interest
02:07rate increase, which would take the cash rate to 4.6%, is in question when the Reserve Bank meets in
02:14August. As I said, this data economists say may give the Reserve Bank some breathing room. But the
02:19big question is how long it wants to wait to see if these three interest rate increases that we've
02:26already had will bring inflation down. It probably makes it a bit of a lineball call, as EY economist
02:35Sherelle Murphy told me earlier.
02:37I think it's going to be a very close call on the next meeting, which as you say is coming
02:42up in two weeks' time. There's not a lot of additional data that's going to influence
02:48them between now and then, of course, subject to what happens in the rest of the world and
02:53particularly in the Middle East. However, I would think that there's going to be some that
02:58are going to be supportive of a higher interest rate. But there will also likely be those who
03:04are happy to sit where they're at and hold the cash rate where it is.
03:08So that's Chief Economist at EY Oceania Sherelle Murphy there. And the RBA next meets on the
03:1411th of August. We will then find out whether or not the cash rate is taken higher.
03:1827th November 2022. So that's what this would like for雪esi is made by thewoof
03:18the reason it is through the 1987 side of the year. And a few years of, yes, it's
03:20very common sense. The rental
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