Australia Economic Data: PPI cools to 0.4% in Q1; Manufacturing PMI beats at 51.3

Australia’s final‑demand Producer Price Index (PPI) rose 0.4% q/q in Q1 2026, down from 0.8% in Q4 and well below consensus of 0.9%. While this marks the 23rd consecutive quarter of producer inflation, the softer print signals cooling inflationary pressures at the producer level. Markets are likely to view the miss as mildly AUD‑negative and could temper expectations for further RBA tightening, though persistent inflation streak leaves some policy uncertainty. Expect near‑term AUD weakness and greater sensitivity in FX and rates markets to upcoming Australian data and RBA commentary.