Another Hot CPI Print Lands

• Yesterday’s first monthly CPI print showed that the stubborn, broad inflation pressures seen through Q3 largely rolled straight into October.
• Headline inflation lifted to 3.8% y/y, keeping Australia comfortably above the RBA’s 2-3% band and reinforcing that the late-year cooling narrative hasn’t materialised.
• The data showed a fresh surge in electricity costs, jumping to 37.1% y/y from 33.9% as government rebates rolled off, while food prices held firm at 3.2%, underscoring ongoing pressure in everyday essentials.
• Underlying inflation also surprised higher, with the trimmed mean lifting to 3.3% y/y, higher than consensus and edging up from 3.2% in September.
• Australian 10-year government bond yields are trading around 4.53% this morning, with rate markets now assigning roughly a 30% probability of a RBA hike by end-2026.