Australia’s core inflation accelerated beyond expectations last quarter, complicating the Reserve Bank’s path to further policy easing and prompting money markets to slash bets on a near-term interest-rate cut.
Yields on three-year government bonds surged the most since January after the closely-watched trimmed mean gauge of consumer prices, which shaves off volatile items, jumped 1% from three months earlier, when it rose an upwardly revised 0.7%, government data showed Wednesday. That blew past economists’ median of 0.8%. On an annual basis, core prices advanced 3% — to the top of the RBA’s band — compared with expectations for a 2.7% increase.