Previewing Australian inflation data that will be released early Wednesday, analysts at TD Securities note that they are below consensus on both the headline Consumer Price Index (CPI) and trimmed mean measure in Q1.

RBA to keep rates unchanged again in May

"We expect headline inflation to ease to 1.2% q/q (cons: 1.3%, RBA: 1.5%) from 1.9% last quarter. This would bring the annual print to 6.8% y/y, from 7.8% y/y in Q4."

"The Jan-Feb monthly CPIs point to a quick easing in price pressures, and it is unlikely that the Q1 print would meet the RBA implied forecasts. To achieve the RBA's Q1'23 7.1% y/y forecast, this would require the monthly Mar'23 CPI to print ~1.35% m/m, significantly above the March outcomes in prior years."

"For CPI trimmed mean inflation, we project it at 1.2% q/q, 6.5% y/y (cons: 1.4% q/q, 6.7% y/y) as broad-based price pressures remain. If both quarterly prints print in line with our forecasts, this should bolster our call for the RBA to keep rates unchanged again in May."