Australia Inflation Rate Above Forecasts

Australia’s annual inflation climbed to 3.8% in December 2025 from November's 3-month low of 3.4%, surpassing market forecasts of 3.6% and remaining above the RBA’s 2–3% target. Services inflation hit a two-year high (4.1% vs. 3.6% in Q3), driven by year-end holiday travel and accommodation, as well as elevated rents. Meanwhile, goods inflation edged higher (3.4% vs 3.3%), due to a faster rise in electricity cost (21.5% vs 19.7%) as some state rebates expired. Price pressures remained broad-based, with continued increases in food and non-alcoholic drinks (3.4% vs 3.3%), alcohol and tobacco (4.9% vs 4.3%), clothing (3.4% vs 5.1%), furnishings (2.0% vs 1.3%), health (3.6% vs 3.6%), transport (1.6% vs 2.7%), communication (1.1% vs 1.3%), recreation (4.4% vs 3.0%), education (5.4% vs 5.4%), and financial services (2.5% vs 2.5%). The trimmed mean CPI inched up to 3.3% yoy from the prior 3.2%, in line with estimates. Monthly, the CPI rose 1.0%, picking up from a flat print in November.

Australia’s annual inflation slowed to 3.4% in November 2025 from 3.8% in October, below market forecasts of 3.7%, and remained above the RBA’s 2–3% target. It marked the lowest inflation since August, with housing prices rising at the slowest pace in three months (5.2% vs 5.9%) amid easing electricity prices (19.7% vs 37.1%) following the expiry of government rebates. Prices also moderated for alcohol and tobacco (4.3% vs 4.4%), clothing (5.1% vs 5.4%), furnishings (1.3% vs 2.1%), health (3.6% vs 4.0%), and recreation (2.0% vs 3.2%). Inflation was steady for transport (2.7%), education (5.4%), and financial services (2.5%), while food inflation (3.3% vs 3.2%) and communication (1.3% vs 0.8%) both accelerated. Trimmed mean CPI eased to 3.2% yoy from October’s 8-month high of 3.3%. Monthly, the CPI was flat. Since last November, Australia has transitioned from the quarterly CPI to the full monthly series as its primary gauge of inflation, with the series extending back to April 2024.

Australia’s annual inflation rose to 3.8% in October 2025 from a September reading that aligned with market forecasts of 3.6%, remaining beyond the RBA’s 2–3% target. In the first full monthly CPI report from the Australian Bureau of Statistics, electricity prices accelerated (37.1% vs 33.9% in September) after the expiry of government rebates, while food inflation stayed elevated (3.2% vs 3.2%). Prices also continued to increase for alcohol & tobacco (4.4% vs 5.5%), clothing (5.4% vs 3.8%), furnishings (2.1% vs 1.8%), health (4.0% vs 4.2%), transport (2.7% vs 2.3%), communications (0.8% vs 1.6%), recreation (3.2% vs 1.8%), education (5.4% vs 5.4%), and financial services (2.5% vs 2.5%). The RBA’s trimmed mean CPI rose to 3.3% yoy, topping the 3% consensus. Monthly, the CPI was flat after a 0.5% gain in September. Wednesday’s print marked Australia’s transition from the quarterly CPI to the full monthly one as a primary gauge of inflation, with the series extending back to April 2024.