Inflation rises but continuing to stabilise

Inflation target remains elusive - Newsreel
Inflation has stabilised but the Reserve Bank's target remains elusive. | Photo: iStock

Australia’s inflation rate is continuing to stabilise at lower rates, but remains outside the Reserve Bank’s two to three percent target range.

Figures released by the Australian Bureau of Statistics today showed inflation (Consumer Price Index) running at 3.6 percent annually in the March quarter 2024.

This followed a one percent rise in the the quarter and continuing upward housing price pressures.

ABS head of prices statistics Michelle Marquardt said the one percent quarterly increase compared with a 0.6 percent rise in the December 2023 quarter.

“While prices continued to rise for most goods and services, annual CPI inflation was down from 4.1 per cent last quarter and has fallen from the peak of 7.8 per cent in December 2022,” she said.

The biggest contributors to the annual CPI rise were housing (up 4.9 percent), food and non-alcoholic beverages (up 3.8 percent), and alcohol and tobacco (up 6.3 percent).

Removing the impact of irregular or temporary price changes in the CPI, annual “trimmed” inflation was 4.0 per cent, down from 4.2 percent in the December quarter.

“This is the fifth quarter in a row of lower annual trimmed mean inflation, down from the peak of 6.8 per cent in the December 2022 quarter,” Ms Marquardt said.

Increases in education fees were evident in the March quarter with tertiary education rising 6.5 percent, secondary education 6.1 percent and primary education 4.3 percent.

The quarterly rise in housing was driven by rent ( up 2.1 percent) and new dwellings purchased by owner-occupiers ( up 1.1 percent).

The Reserve Bank has set a CPI target range of two to three percent to trigger decreases in interest rates.

More detail is available on the ABS website.