Australian Consumer Price Index (CPI)  fell short of market expectations with headline inflation falling from 7.4% year-on-year in January to 6.8% in February. This will further support a hike at next month's RBA meeting, economists at ANZ Bank report.

RBA to hike in April; Inflation momentum remains strong

“Annual inflation fell to 6.8% YoY in February, down from the peak 8.4% YoY in December, providing further confirmation that we passed peak inflation in Q4.”

“Australia’s monthly CPI indicator showed inflation momentum remains strong and is not slowing as much as the fall in annual inflation would suggest. Along with previous data releases, this makes us comfortable with our call that the RBA will raise the cash rate 25 bps at its April meeting.”

“While the RBA has signalled its intention to pause at some point in coming months, we continue to think that the data is not yet consistent with a pause.”