Fed: Costello says PPI data good news

AAP General News (Australia)
04-23-2007
Fed: Costello says PPI data good news

SYDNEY, April 23 AAP - Federal Treasurer Peter Costello says today's producer price
index (PPI) data is good news for the economy.

"The upstream price index that was released today is good news," Mr Costello said following
a book launch at the Australian stock exchange.

"It shows there aren't significant pressures, in fact, it was flat, not upstream."

The PPI - a measure of the price of materials paid by producers - for the final stage
of production was unchanged in the March quarter after rising 0.2 per cent in the December
quarter, figures from the Australian Bureau of Statistics (ABS) showed.

Mr Costello said tomorrow's consumer price index (CPI) data would be important to see
the effect for consumers, noting there would be one-offs in relation to fruit and vegetables
as well as petrol.

"The important thing is to keep those prices down for the benefit of consumers, and
for the benefit of the economy," he said.

Economists have been eagerly awaiting the March quarter CPI for a final clue as to
whether inflation is high enough for the Reserve Bank of Australia (RBA) to raise interest
rates in May.

The market expects CPI to rise 0.6 per cent in the quarter for an annual pace of 3.1 per cent.

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KEYWORD: PPI COSTELLO

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