SYDNEY, Jan 10 Reuters Australia39;s inflation slumped to a near twoyear low in November and core inflation also eased sharply, a softerthanexpected result that reinforced market expectations interest rates would not need to rise any further.

Data from the Australian Bureau of Statistics on Wednesday showed its monthly consumer price index CPI rose at an annual pace of 4.3 in November, the slowest pace since January 2022. That was down from 4.9 in October and under market forecasts of 4.4.

For the month, CPI rose 0.3.

A closely watched measure of core inflation, the trimmed mean, rose an annual 4.6, down sharply from 5.3 in November, a major relief for policymakers who had forecast the gauge to fall to 4.5 by December.

The slowdown was driven by petrol prices, which fell 0.5 on a monthly basis, and clothing and footwear discounts during the Black Friday sales. The CPI excluding volatile items and holiday travel slowed to 4.8, from 5.1.

Today39;s fall in the trimmed mean and the core measure, below 5, confirms that the disinflation narrative remains firmly in place and expectations of RBA rate cuts in 2024, said Tony Sycamore, market analyst at IG.

He said that if the fourth quarter inflation report, due in late January, paints a similar picture for consumer prices, markets could bring forward expectations of the first rate cut from the Reserve Bank of Australia RBA to June from August currently.

Market reaction to the data was muted as liquidity is still thin in…