The Melbourne Institute Inflation Gauge for December 2016

0.5 % m/m

  • prior 0.1%
  • Yeah, I did a double-take on that too

1.8 % y/y

  • prior 1.5%


The 'trimmed mean' has come in at 0.5% also, and 1.4% for the y/y.

That's a big jump in this measure of inflation (m/m) and is another argument in favour of rates on hold for a while yet. Having said this, the target band (over a cycle) is 2 to 3% (that's the RBA target band) so at 1.4% y/y for the trimmed mean its below.