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Australian inflation continues downward trend, nearing RBA target
The Australian Bureau of Statistics (ABS) has reported that the Consumer Price Index (CPI) rose 2.7 per cent in the year to August, down from 3.5 per cent in July and 3.8 per cent in June.
Australian inflation continues downward trend, nearing RBA target
The Australian Bureau of Statistics (ABS) has reported that the Consumer Price Index (CPI) rose 2.7 per cent in the year to August, down from 3.5 per cent in July and 3.8 per cent in June.
Real Estate Institute of Australia (REIA) President Leanne Pilkington said: "The annual movement for the monthly CPI excluding the volatile items of fruit and vegetables, automotive fuel and holiday travel and accommodation, rose 3.0 per cent in August, down from the July figure of 3.7 per cent and 4.0 per cent for June."
The annual trimmed mean, an important analytical series, also decreased to 3.4 per cent in August from 3.8 per cent in July and 4.1 per cent in June.
Pilkington noted that all three broad measures of inflation are at their lowest levels since 2021, before the Reserve Bank of Australia (RBA) began increasing interest rates in May 2022.
The most significant price rises at the group level were in Housing (up 2.6 per cent), food and non-alcoholic beverages (up 3.4 per cent), and alcohol and tobacco (up 6.6 per cent).
Rental increases are also showing signs of moderation, with a 6.8 per cent rise in the 12 months to August, down from 6.9 per cent in July and 7.1 per cent in June.
REIA's Real Estate Market Facts report indicates that vacancy rates increased in most capital cities, suggesting the slowdown in rental increases may continue.
Pilkington stated: "With a consistent downward trend across the three measures of CPI, including the RBA's trimmed mean, we are steadily inching our way to the RBA's target zone and the anticipation that a rate cut cannot be far away."
However, she cautioned that current speculation about abolishing negative gearing could halt this progress, potentially leading to additional rent increases of between 7 and 12 per cent, according to various studies.
The REIA represents 85% of Australian real estate agencies, encompassing 46,793 businesses that employ 133,360 Australians.
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