-
Aust Q2 Wages First impressions: Modest upside surprise does not change weak fundamentals
The June quarter has brought a very modest lift in wage inflation. In the quarter the Wage Price Index (WPI) lifted 0.6% vs market expectation for a 0.5% rise and up slightly from the 0.5% rise in the March quarter. This held the annual rate flat at 2.3%yr which is a modest lift from the low of 1.9% in 2017 but can hardly be described as a breakneck pace. We still expect wage inflation to drift higher from here - our forecasts have it peaking around 2¾%yr in 2020 - but given how well contained wage inflation is across the nation, and between sectors, even this modest increase looks optimistic and the risks to this ... (full story)