CPI rose by 4.2% in 12 months to April
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The news: The consumer price index (CPI) increased by 4.2% in the 12 months to April 2026, lower than consensus expectations for a 4.4% increase.
However, trimmed mean inflation for the 12 months to April came in at 3.4%, in-line with market consensus expectations for a 3.4% increase and higher than the 3.3% increase in March. Automotive fuel was excluded from this measure in March and April.
The numbers: The CPI increase in the year to April was lower than the 4.6% increase in March and the 3.7% increase in February.
Over the year, housing (+6.3%) was the largest contributor to annual inflation, followed by transport (+6.3%) and food and non-alcoholic beverages (+2.8%).
Automotive fuel prices fell 7% in the month to April after lifting 32.8% in March, but are still 23.5% higher than in February, before the impact of the US-Iran war.
Electricity costs, which are captured in the housing inflation measure, are 22.5% higher than 12 months ago due to Commonwealth and state government rebates no longer being in effect.
CPI lifted 0.4% on a month-to-month basis in original terms but fell 0.1% in seasonally adjusted terms.
The context: The April inflation data is the first set since the federal government temporarily halved the fuel excise from 1 April.
In May, the Reserve Bank of Australia said it expected headline inflation to peak at 4.8% in June 2026, according to its quarterly statement on monetary policy. Meanwhile, Treasury’s forecasts released alongside the budget expected headline inflation to peak at 5% in the middle of the year.
The RBA has lifted interest rates on three occasions this year amid inflationary pressures from the Australian economy reaching its productive capacity limits and concerns regarding the flow through impacts of the fuel crisis sparked by the US-Iran war.
What they said: “The impact of higher oil prices has also been seen in products and services with high freight and logistics costs, such as parcel delivery and building materials,” ABS head of prices statistics Sue-Ellen Luke said.
“This is reflected in price increases of 12.4% for postal services and 4.7% for new dwelling construction compared to 12 months ago.”
The sources: ABS media release, ABS data
