Reserve Bank of Australia forecast inflation to rise only gradually over time and the economy to grow at a solid pace as the drag on growth from the end of the mining investment boom has eased.
In its quarterly Statement on Monetary Policy, released Friday, the Reserve Bank projected inflation to rise slightly to 2.25 percent in the year ending December 2018 from an estimated 2 percent in the year to December 2017.
Inflation was projected to remain at 2.25 percent untill the year ending December 2019.
In August, the bank had projected 1.5-2.5 percent inflation for December 2017 and 1.75-2.75 percent in December 2018.
Underlying inflation was forecast to reach only 2 percent by December 2019.
The December quarter 2017 consumer price index will be based on updated weights for the individual goods and services.
The decision to lower the forecasts to below the bottom of the band in 2018 and at the bottom of the band in 2019 has significant policy implications, Bill Evans, an econo..
While it sees economic growth accelerating, the Reserve Bank of Australia cut its forecasts for core inflation as the interest benchmark rate was held steady at a record-low of 1.5 percent in its latest policy meeting.
According to the statement released, RBA also projects little improvement in the jobless rate despite a jump in employment since the beginning of the year.
The regulator tempered estimates for growth in mid-2018 to 2.75 percent, down from the earlier forecast of 3 percent.
It sees the unemployment rate stabilizing around 5.5 percent right out to June 2019. But it noted that market conditions have significantly strengthened and early indicators suggest that the above average employment growth will be sustained.
Forecasts for underlying inflation was revised slightly lower for 2018 and slashed by half percentage point for 2019, mainly to accommodate the upcoming reassessment of CPI. Last August, RBA had estimated core inflation would hit 2 percent in the second half ..
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Singapore's retail sales declined notably in September, defying economists' forecast for a slight increase, data from the Department of Statistics showed Friday.
Retail sales decreased a seasonally adjusted 4.2 percent month-over-month in September, after remaining flat in the previous month. Meanwhile, economists had expected a 0.1 percent increase for the month.
Excluding motor vehicles, retail sales dropped 0.2 percent on month versus a 0.9 percent fall in August.
Retail sales of motor vehicles alone plunged by 19.9 percent and those of furniture and household equipment dipped by 5.4 percent.
At the same time, sales of wearing apparel and footwear registered a growth of 2.9 percent.
On an annual basis, retail sales fell 0.5 percent in September, reversing a 3.7 percent gain in the preceding month. It was forecast to increase by 3.0 percent.