Inflation in Australia has remained at its lowest level in over three years, with the consumer price index (CPI) holding steady at 2.1 per cent for October, matching the previous month and lower than August’s 2.7 per cent. This marks the lowest inflation rate since July 2021. Benefits from energy rebates and decreased fuel costs contributed to this sustained low headline inflation, keeping it within the Reserve Bank of Australia’s target range. However, the crucial underlying measure known as the trimmed mean saw a slight increase to 3.5 per cent, remaining above the target of 2 to 3 per cent. ABS head of prices statistics, Michelle Marquardt, noted that the declines in electricity and fuel substantially influenced the annual CPI for October.
While inflation appears stable, another underlying measure, the CPI excluding volatile items and holiday travel, dropped to 2.4 per cent, down from 2.7 per cent in September. Given the uptick in the trimmed mean, it is unlikely the Reserve Bank will lower interest rates at its upcoming meeting, as they typically focus more on quarterly figures, the next of which will be available in late January.