The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Friday, April 13, 2012

UBS consumer price survey argues for a May cut

Here is a snapshot of the UBS CPI survey results (see full report for the detail). If UBS are right, and core inflation prints at a low 0.5%, we should get a cut in May:

This week we canvas the results of UBS’s CPI survey for Q112. The survey points to marginally lower core inflation than we’d previously pencilled in. For headline CPI, our survey shows a 0.7% rise (nsa), but a 0.5% rise when seasonally adjusted, delivering a largely anticipated drop in the y/y pace to 2.2%, from 3.1% in Q411...For the more policy-sensitive core inflation measures, our survey shows an average rise of 0.5% for Q112 (below the 0.6% forecast we’d had previously). This would see the y/y pace of underlying inflation ease to 2¼% in Q1, from 2½% in Q411...So our ‘line in the sand’ for a May cut is “below 0.7%”.