CPI Holds Firm, RBA Still Watching

• April CPI printed at 2.4% y/y, slightly above the 2.3% forecast, with higher new dwelling costs surprising to the upside.
• New Dwelling Purchase prices rose 0.5% m/m — a key driver of the trimmed mean, which lifted to 2.8% y/y from 2.7%.
• The housing category, which makes up 8% of the CPI basket, had been a source of disinflation but now poses upside risk.
• The RBA remains cautious and data-dependent, with next month’s quarterly CPI seen as a key print ahead of their next meeting on July 8.