The Australian inflation indicator for April, published this morning, came in at 2.4%, which is slightly higher than expected, Commerzbank's FX analyst Michael Pfister notes.

Australian retail sales slipped unexpectedly in April as warm weather hit spending on winter clothing, data showed on Friday, while department stores suffered from a dearth of discounting events in further evidence of a cautious consumer.

Goldman Sachs has estimated the redirection of Chinese goods into Australia, particularly in toys, furniture and clothing, could subtract 20-50 basis points from headline inflation over the next year or two. Those forecasts were made before China and the U.S. agreed to pause steep tariffs this month.