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Australia Q4 Wage Price Index

The Australian Bureau of Statistics publishes the official change in wage prices once per quarter. This usually means it has a bigger impact on the market as it’s more anticipated.

It’s also important because it’s one of the indirect measurements relevant to RBA policy.

The RBA is currently monitoring employment closely in order to maintain price stability. As the cost of labor (wage prices) increases, this typically translates to customers in the form of higher prices. This is because people’s purchasing power increases as well.

Within a growing economy, there ought to be a steady increase in wage prices, above the inflation rate.

Generally, wage inflation should “lead” the overall CPI measure. It should be higher than the inflation target.

And, moves in wage prices generally come ahead of (organic) moves in inflation. So, while as a measure it doesn’t always immediately move the market, it’s an important factor when gauging future infla...

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