Australian inflation rises to 4.3 per cent as fuel costs surge
Australian consumer prices accelerated in September, with annual inflation reaching 4.3 per cent and the monthly increase doubling from August. Housing and transport were major contributors. Underlying inflation also edged higher after a downward revision to August’s reading. The data arrived ahead of the Reserve Bank’s November interest-rate decision, with fuel and electricity among the prominent pressures.
Economics & Markets··Midday
Monthly price growth doubles
Australia’s consumer price index rose 4.3 per cent in the year to September, compared with 4 per cent in August. The Australian Bureau of Statistics, the national statistics agency known as ABS, recorded a monthly increase of 0.8 per cent, up from 0.4 per cent. The acceleration preceded the Reserve Bank of Australia’s November interest-rate meeting and followed rising housing and transport costs.[1], [2]
Annual trimmed mean inflation, which removes the tails of the distribution of price changes, reached 3.6 per cent. August’s reading was revised down from 3.6 per cent to 3.5 per cent following changes in seasonal factors. The seasonally adjusted monthly increase in the headline index was 0.6 per cent; the monthly trimmed mean rose 0.3 per cent on that basis.[1]
Fuel and electricity raise household bills
Transport prices were 8.7 per cent higher than a year earlier. Automotive fuel rose 9.4 per cent during September and 23.6 per cent over the year. Housing prices increased 5.2 per cent annually, including a 12.8 per cent rise in electricity, a 3.6 per cent increase in rents and a 4.7 per cent gain in new dwelling prices.[1]
The price increases extended to other household purchases. Food and non-alcoholic beverages rose 3.2 per cent annually, compared with 3.0 per cent in August, and health prices increased 3.7 per cent. Recreation and culture rose 4.5 per cent. Domestic holiday travel and accommodation increased 8.0 per cent during the month and 5.3 per cent annually, while games, toys and hobbies rose 15.5 per cent over the year.[1]
Underlying pressure precedes the November rate decision
Goods prices rose 4.6 per cent annually and service prices increased 4.1 per cent. ABC News reported that central bank deputy governor Andrew Hauser described inflation as too high, while broadly consistent with the bank’s expectations. The bank targets inflation of 2 per cent to 3 per cent. Its officials were appearing at a Senate hearing as the new data were released, before the following week’s monetary policy decision.[1], [2]
