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The five-year, beyond the QE range, jumped 13 basis points to 1.34%. The Australian two-year bond yield, which the RBA is supposed to be capping at 0.10%, rose 5 points to 0.18%. You can probably tell when the CPI data hit. The ASX200 opened up 30 points in the first half hour yesterday and at 11.30am was up 24. In isolation, a drop in headline inflation should be positive on a global comparison basis, and even a trans-Tasman basis, but the move above 2% for the core rate only implies one thing – the first RBA rate hike might be closer than the central bank insists. The big increase was in “non-tradable” inflation, which includes such items as electricity, water, all public services, hotel accommodation, real estate, construction, local transportation. It rose 0.7% for an annual rate of 2.1%, up from 1.8%, to mark the first move into the RBA’s target zone since 2015. The surprise, however, was the RBA’s “trimmed mean” or core inflation number. The biggest contributors to inflation last quarter were owner-occupier house purchases (+3.3%) and fuel costs (+7.1%). The primary reason for the fall was that last June, the economy was surviving on government handouts, which expired after last year’s lockdown. The annual rate fell to 3.0% from the June quarter’s 12-year high 3.8%. For more info SHARE ANALYSIS: A2M World OvernightĪustralia’s headline inflation rose by 0.8% in the September quarter as expected. This story features A2 MILK COMPANY LIMITED, and other companies.