Treasurer says Labor is 'delivering lower inflation' after new CPI figures
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More news: Treasurer Jim Chalmers said the Labor Party is "delivering lower inflation, lower taxes, higher wages and immediate ongoing help with the cost of living" after annual underlying inflation, the Reserve Bank's preferred measure, fell below 3% for the first time in three years.
“Peter Dutton and the Coalition go to this election with a policy for higher taxes, lower wages, no ongoing help with the cost of living and savage cuts to pay for their nuclear reactors,” Chalmers said.
Underlying inflation rose 0.7% in the March quarter, following a rise of 0.5% in the December quarter. On an annual basis, it rose 2.9%, following a rise of 3.3% over the 12 months to December.
The Reserve Bank next makes a decision on interest rates on 20 May. Underlying inflation retreating below 3% may open the door to the second interest rate cut this year, even though economists had expected to see a larger decline — to 0.6% for the quarter and 2.8% annually — in today's data.
The ABS figures mark the first time since 2021 that trimmed mean annual inflation has been inside the RBA's target band of 2% to 3%.
Consumer price index up 2.4% annually in March
The news: The Consumer Price Index (CPI) rose 0.9% in the March quarter and 2.4% annually, according to the latest data from the Australian Bureau of Statistics (ABS).
Economists had expected a 0.8% quarterly rise and a 2.3% annual increase.
The numbers: The March quarter increase of 0.9% followed two consecutive quarters of 0.2% growth.
Annual inflation to the March quarter of 2.4% was unchanged from the December 2024 quarter.
Underlying inflation, the Reserve Bank's preferred measure, rose 0.7%, following a rise of 0.5% in the December quarter. On an annual basis, it rose 2.9%, following a rise of 3.3% over the twelve months to December.
The context: The ABS said the main contributors to the quarterly CPI rise were housing (1.7%), education (5.2%) and food and non-alcoholic beverages (1.2%).
The quarterly growth in housing was driven by electricity (16.3%), buoyed by increases in electricity prices in Brisbane.
Education prices increase 5.2% this quarter, following the start of the school year, with higher operating costs being passed on as higher school fees.
The 1.2% rise in food and non-alcoholic beverages was led by a 2.8% increase in fruit and vegetable prices, with seasonal price rises for avocados, mangoes, asparagus, tomatoes and lettuce amid reduced supply.
The source: ABS
