Australia Inflation Accelerates to 0.9%

Australia’s inflation rate almost doubled in the first quarter to 0.9 percent, making it more likely that the central bank will keep raising borrowing costs., Bloomberg 4/28/2010 10:33:59 AM

The increase in the consumer price index from the previous three months followed a 0.5 percent gain in the fourth quarter. Prices rose 2.9 percent from a year earlier, the most since late 2008, the Bureau of Statistics said.

Inflation pressures are building as surging investment in resources projects such as Chevron Corp.’s Gorgon gas field in Western Australia worsens a skills shortage that threatens to stoke wage growth.

Gasoline costs rose 4.2 percent in the first quarter and pharmaceutical prices advanced 13.3 percent, today’s report showed. By contrast, fruit fell 5.7 percent.

Underlying inflation was about 2.75 percent, annualized, in the second half of 2009, according to the central bank.

Australia Inflation Accelerates to 0.9%