Aus inflation

Australia’s monthly inflation print is a relatively new series (middle row, left), however, it’s a very timely new addition given the current issues of above target inflation.

Yesterday, the Feb monthly print was released, coming in below expectation (here, that’s a good thing) at 6.8%.

Given the retail sales data from the day prior continues to also trend lower, this will help reassure the RBA that the job is, if not yet completely done, it is at least not so far from done.

Given our number one worry has been high inflation begets high rates, which pressures overleveraged households, this is a positive development.

We remain in high quality defensives, in our direct Aussie equities configuration. If inflation behaves, we’ll make money, albeit perhaps a bit less than benchmark. If things remain “out of hand”, we’ll be glad for our defensive positioning.

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