Wednesday's consumer price index from the Australian Bureau of Statistics is tipped to show a sharp decline in headline inflation as the federal government's power relief kicks in as well as lower default market offers in some states.
Signs of cooling inflation will be welcomed by the Reserve Bank of Australia but it has already indicated it plans to look through the temporary bill relief and focus on underlying inflationary pressures.
The central bank remains of the view underlying inflation is still too high and has hosed down expectations of a near-term interest rate cut, suggesting mortgage holders will be waiting until next year for repayment relief.
Commonwealth Bank of Australia economist Stephen Wu said the electricity rebates would make the July consumer price index, due on Wednesday, a "tricky release to interpret".
The bank was tipping a fall to 3.4 per cent, down substantially from 3.8 per cent in July.
Travel prices were another spanner in the works, Mr Wu said, with the timing of school holidays and northern hemisphere travel making movements hard to predict.
In addition, not all prices are measured in the monthly consumer price index, further complicating the readout.Â
"We will look more at the granular data for price signals, rather than necessarily focus on where the headline print comes in," Mr Wu said.
ANZ economists were also expecting a sharp decline in headline inflation, to 3.3 per cent in July.
As well as the consumer price index, the ABS will start releasing data useful for economists forecasting gross domestic product.
Construction work done is scheduled for Wednesday and capital expenditure on Thursday.
Consumer activity will also be on show later in the week as retail sales figures are released for July.
In June, turnover rose 0.5 per cent, bolstered by shoppers taking advantage of end-of-financial-year sales.
Wall Street rallied on Friday as dovish remarks from Federal Reserve chair Jerome Powell solidified expectations the central bank will cut its key policy rate in September.
The Dow Jones Industrial Average rose 462.3 points, or 1.14 per cent, to 41,175.08, the S&P 500 gained 63.97 points, or 1.15 per cent, to 5,634.61 and the Nasdaq Composite added 258.44 points, or 1.47 per cent, to 17,877.79.
Australian futures rose 41 points, or 0.51 per cent, to 7.129.
The S&P/ASX200 finished Friday at 8,023.9, down 3.1 points from Thursday, but up 0.7 per cent for the week.
The broader All Ordinaries dropped nine points, or 0.11 per cent, to 8,249.1.
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