The Consumer Price Index (CPI) rose 0.2 per cent in the September 2024 quarter and 2.8 per cent annually, new data from the Australian Bureau of Statistics (ABS) revealed.
ABS head of prices statistics Michelle Marquardt said the quarterly rise of 0.2 per cent is the lowest outcome since the June 2020 quarter fall, which occurred during the COVID-19 outbreak and was driven by free childcare.
“Annually, the September quarter’s rise of 2.8 per cent was down from 3.8 per cent in the June quarter. This is the lowest annual inflation rate since the March 2021 quarter,” Marquardt said.
The quarterly lift was driven by alcohol and tobacco as well as recreation and culture, both recording CPI rises of 1.3 per cent each. Rises in prices for other goods and services were largely offset by falls in electricity (down 17.3 per cent) and automotive fuel prices ( down 6.7 per cent).
It was also offset by a 0.7 per cent fall (or deflation) in clothing and footwear, behind a 2.2 per cent fall in transport. Housing and health also recorded deflation, with the rest rising quarter-on-quarter.
Sticking to fashion, ABS data showed that the main contributors to its quarterly fall were garments (down 1.2 per cent) and footwear (down 2.1 per cent), driven by mid-season and winter wear sales events in the September quarter.
Accessories rose 1.4 per cent, due to items returning from discounting and price rises for gold jewellery.
Over the past twelve months, clothing and footwear rose 1.7 per cent. Garments for women (up 3.3 per cent) was the main contributor.
“The 2024-25 Commonwealth Energy Bill Relief Fund rebates in all states and territories and state government electricity rebates in Queensland, Western Australia and Tasmania led to a large fall in electricity prices this quarter. Without the rebates, electricity prices would have increased 0.7 per cent this quarter,” Marquardt said.
Automotive fuel prices fell 6.7 per cent this quarter as lower global demand reduced the price of oil. This saw petrol prices fall in each of the past three months to reach their lowest level since the June 2023 quarter.
The quarterly growth in Recreation and culture was driven by international holiday travel and accommodation (up 1.9 per cent) and domestic holiday travel and accommodation (up 1.1 per cent).
Higher demand for international tours and accommodation, particularly in Europe where it was peak travel season, led to price increases. The school holiday period contributed to increases in domestic accommodation prices.
When prices for some items move by large amounts - noting electricity and automotive fuel - measures of underlying inflation like the trimmed mean can provide additional insights into how inflation is trending, ABS added. Trimmed mean annual inflation was 3.5 per cent down from 4.0 per cent in the June quarter.
“The trimmed mean excluded the significant falls in both electricity and automotive fuel this quarter, alongside other large price rises and falls. As a result, trimmed mean annual inflation of 3.5 per cent was higher than CPI inflation of 2.8 per cent,” Marquardt said.
Annually, the 2.8 per cent lift in CPI was also driven by electricity and automotive fuel.
Annual goods inflation was 1.4 per cent, driven by price rises for new dwellings and tobacco. The decline in annual goods inflation from 3.2 per cent in the previous quarter was due to the significant falls in electricity and fuel prices.
Annual services inflation was 4.6 per cent in the September quarter, up from 4.5 per cent in the June quarter. Higher prices for rents, insurance and child care were the main contributors to services inflation.