Inflation Data Set to Reveal Rate Hike Clues

A crucial inflation reading will be released on Wednesday, providing insight into whether the Reserve Bank of Australia (RBA) will raise interest rates again. The data shows fuel prices bounced back in July after easing in June.

ANZ Bank economists forecast the headline consumer price index to rise 0.8 per cent for the month, but a softer electricity print compared to 12 months prior will see the annual figure ease 0.6 percentage points to 3.2 per cent. The trimmed mean, which shows growth in underlying prices and is watched closely by the RBA, is expected to lift 0.3 per cent for the month.

RBA governor Michele Bullock has warned that if inflation exceeds forecasts, there will be no hesitation in raising rates again. Analysts will also pore over minutes from the RBA's last board meeting when they are released on Tuesday.