Australia's annual inflation rose to 4.0 percent in August
Australian consumer prices were 4.0 percent higher than a year earlier in August, up from a 3.5 percent annual rate in July. Transport and housing were prominent parts of the price picture. The trimmed mean, which removes unusually large price moves, held at 3.6 percent over the year. Headline inflation therefore accelerated while this narrower underlying measure did not; one monthly release cannot by itself establish a lasting trend.
Economics & Markets··Midday
Annual inflation rises again
Australia’s consumer price index was 4.0 percent higher in August than a year earlier, after a 3.5 percent annual increase in July. The Australian Bureau of Statistics released the figures, and ABC News reported the same rise in its business coverage. The monthly seasonally adjusted increase was 0.7 percent; the unadjusted monthly measure was 0.4 percent. Those are different series, so their difference is not a dispute over the annual result. The headline rate had eased through June and July before rising in August.[1], [2]
Transport and housing remain prominent
Transport prices rose 5.6 percent from a year earlier and 4.2 percent from July in the original series. Housing was 5.7 percent more expensive than a year earlier. Food and non-alcoholic beverages rose 3.0 percent annually but fell 0.1 percent in the month. These category movements show that inflation differs across household budgets, even when one national index is used as the headline. Goods prices were up 4.2 percent over the year, compared with 3.7 percent for services.[1]
Underlying measure holds steady
The trimmed mean increased 3.6 percent over the year, the same annual rate as in July. That measure excludes unusually large movements at either end of the price distribution; it is not a count of items that most households purchase. The contrast with the faster headline rate helps locate August’s rise without turning one reading into a forecast. The bureau also reported that domestically oriented, non-tradable prices increased faster over the year than prices of items exposed more strongly to international trade. The next releases can show whether the divergence persists.[1]
