Melbourne Institute Survey of Consumer Inflationary Expectations

Thursday 11 April 2008

Tighter monetary policy impacts on consumer inflationary expectations

The median expected inflation level for the Melbourne Institute Survey of Consumer Inflationary Expectations decreased to 4.3 per cent in April, from 4.6 per cent in March. The proportion of survey respondents expecting annual inflation to fall within the Reserve Bank’s target band of 2-3 per cent also decreased to 11.2 per cent in April from 11.8 per cent in March.

According to Dr. Sam Tsiaplias, a Research Fellow at the Melbourne Institute, "April’s median expected inflation figure provides some evidence that the effects of tighter monetary policy are feeding into consumer inflationary expectations, with the April figure interrupting three successive months of increases in the median expected inflation rate."

Dr. Tsiaplias added, “inflationary expectations, however, continue to remain high. Inflationary expectations were recorded at above four per cent for the seventh consecutive month. Expectations data over the last few months also suggest a downward trend in the proportion of consumers expecting inflation to fall within the Reserve Bank’s target range in the next 12 months. These results tend to corroborate Reserve Bank expectations of a persistent state of high inflation in the short-term.”

The May 2008 Survey of Consumer Inflationary Expectations will be released at 11 am AEST, Thursday 15 May, 2008.

The latest Melbourne Institute Survey of Consumer Inflationary Expectations can be found at http://www.melbourneinstitute.com/research/macro/cie.html

Contact
Dr. Sam Tsiaplias
Melbourne Institute of Applied Economic and Social Research, The University of Melbourne
Phone : 03 8344 2145
Fax : 03 8344 2111
Email : ssts@unimelb.edu.au

Media Contact
Mr Ordan Andreevski
Melbourne Institute of Applied Economic and Social Research, The University of Melbourne
Mobile : 0438 385 466
Fax : 03 8344 2111
Email : oan@unimelb.edu.au
Web : www.melbourneinstitute.com