CPI to resolve rate debate

When the Reserve Bank of Australia (RBA) meets in February 2007 to determine whether or not to raise interest rates again, it will be faced with apparently conflicting data; strong employment growth yet weak national accounts. The market has currently factored a 40 per cent probability that rates will rise in February. The December quarter consumer price index (CPI) will provide the RBA with crucial data needed to determine the strength of the economy.

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