Two categories that were helpful in easing inflation may not be so beneficial in coming months.Īutomotive fuel fell 1% in the quarter, with the average unleaded petrol price dropping 2 cents to $1.94 per litre. Goods and services deemed by the ABS to be “non-discretionary” rose 4.2% from a year earlier, while “discretionary” ones rose 2.9%. At an annual rate, the trimmed mean eased to 4% from 4.2% in the December quarter, while the weighted median was steady at 4.4%. The Australian dollar leapt more than a quarter of a US cent to trade at about 65.25 US cents, while the ASX200 share index erased its gains of about 0.4% for the day.Īside from the headline CPI, the RBA also looks at the trimmed mean and weighted median measures that strip out some of the volatile movers.īoth had been expected to increase 0.9% for the quarter, but instead rose 1% and 1.1%, respectively. The Albanese government will likely argue its spending won’t stoke inflation pressure and delay any interest rate cut by the central bank.Īfter the ABS released the figures, financial markets trimmed their bets that an early interest rate was in the offing. The federal budget, to be released on 14 May, will also be shaped by the inflation figures. Prior to today’s data release, investors were rating only a sliver of a chance of an RBA rate cut next month, with markets fully pricing in a 25-basis point reduction in the cash rate by February 2025. The Reserve Bank’s board will analyse the latest data closely when it meets on 6-7 May. On the other hand, China – easily Australia’s biggest trading partner – has been flirting with deflation, a trend that would tend to ease inflation globally. Other nations, such as the US and UK, had lately seen inflation either start to rebound or slow less than expected, fostering concerns about the challenges of the so-called last mile of squeezing excessive demand out of the economy. The country’s inflation rate has been falling since it hit a peak at the end of 2022, driven lower in part by the sharpest increase in official interest rates in three decades. Without government rebates, the annual rise would have been 17%. From a year earlier, they were 2% higher. They fell 1.7% in the March quarter, reversing a 1.4% rise in the previous three months. Sign up for Guardian Australia’s free morning and afternoon email newsletters for your daily news roundupĮlectricity prices were among those turning lower. Perth alone saw rents jump 9.9% from a year ago, ahead of Sydney’s 8.9% increase and 6.8% in Melbourne – though Hobart’s rents eased 0.4%. Rents advanced 2.1%, lifting the annual increase to 7.8%, or the fastest pace in 15 years amid very low vacancy rates, the ABS said. Health costs were also up 2.8% for the three months.

“Inflation will keep easing from here but progress will be slow.”Įducation costs in the quarter rose 5.9%, led by a 6.5% jump for tertiary expenses. “Service inflation is the main culprit holding back progress,” he said. “Having sprinted lower in the back end of 2023, headline inflation is struggling to keep that momentum going,” Harry Murphy Cruise, an economist with Moody’s Analytics, said.įor March alone, CPI was 3.5%, up from the 3.4% pace recorded for January and February. Graphic of all groups CPI, Australia, quarterly and annual movements

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