Market Essentials - May 2022

As this edition goes to press, the Australian Bureau of Statistics announced the quarterly Consumer Price Index, aka inflation, has jumped to 5.1 per cent this quarter. Michelle Marquardt, ABS Head of Prices Statistics, said this was “the largest quarterly increase since the introduction of the goods and services tax in 2000”.

The hike in inflation now leaves the door open for the RBA to increase the interest cash rate from its record low of 0.1 per cent, something that the RBA said wouldn’t occur until 2024.

As of Tuesday May 3, the RBA has lifted the official cash rate to 0.35%, the first rate rise in more than a decade, with more rises expected in the coming months.