Central Banks
RBA Will Be ‘Hypersensitive’ to Inflation, Westpac’s Ellis Says
- Sticky services prices make policymakers nervous about outlook
- Houthi attacks on Red Sea shipping routes among ongoing risks
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Australia’s central bank will be “hypersensitive” to any signs that inflation is staying sticky, with surging population growth and further tensions in the Middle East among renewed sources of price pressures, according to Westpac Banking Corp. chief economist Luci Ellis.
“Inflation will keep coming down as long as there aren’t big upside surprises, we think that will provide some comfort to the RBA,” Ellis, a former Reserve Bank assistant governor, said in Bloomberg TV interview on Wednesday. “But they are watching services inflation, they are nervous that won’t come down fast enough.”