The Australian Consumer Price Index (CPI) rose 2.7% in August, down from 3.5% in the previous month and bringing inflation within the RBA's target range of 2-3%.
The CPI excluding volatile items such as automotive fuel, fruit, vegetables, and holiday travel showed a 3.0% increase in August, down from 3.7% in July.
Electricity prices recorded their largest annual drop on record, falling by 17.9% in the 12 months to August, driven by Commonwealth Energy Bill Relief Fund (EBRF) rebates and additional state rebates in Queensland, Western Australia, and Tasmania.
Automotive fuel prices fell 7.6% compared to August 2023, a significant decline from the 4.0% rise in July, primarily due to base effects and lower global oil prices.
Urban transport fares also retreated by 1.5% year-on-year, driven by reduced public transport costs in Brisbane, Hobart, and Darwin.
Trimmed mean inflation, which smooths out irregular price changes, was 3.4% in August, down from 3.8% in July. This measure excluded significant fluctuations in prices for automotive fuel and electricity.
Insurance costs surged 14.0% year-on-year, reflecting higher reinsurance, natural disaster expenses, and claim costs and extends the previous month’s increase.
Holiday travel and accommodation prices rose 2.8%, but monthly prices fell 1.4%, as domestic demand softened outside school holiday periods.
New dwelling prices increased by 5.1% in the 12 months to August, remaining consistent since August 2023, as builders passed on higher material and labor costs. Rental prices rose 6.8% year-on-year, slightly lower than the 6.9% recorded in July, reflecting a persistently tight rental market.
Food and non-alcoholic beverage prices increased by 3.4%, with notable rises in fruit and vegetables (+9.6%) and takeaway foods (+2.9%). However, dairy prices fell slightly by 0.2%, driven by lower cheese prices.