Australia’s monthly Consumer Price Index (CPI) indicator rose 2.5% in the 12 months to January 2025, unchanged from December, according to the latest data from the Australian Bureau of Statistics (ABS).
While headline inflation remained steady, trimmed mean inflation, which excludes irregular price movements, and the CPI measure that excludes volatile items and holiday travel both edged higher.
ABS head of prices statistics Michelle Marquardt said: “Annual trimmed mean inflation was 2.8% in January, up slightly from 2.7% in December. The CPI excluding volatile items and holiday travel measure rose 2.9% in the 12 months to January, compared to a 2.7% rise in the 12 months to December.”
Key contributors to annual inflation included food and non-alcoholic beverages, lifting 3.3%, housing, up 2.1%, and alcohol and tobacco, gaining 6.4%.
Food prices accelerated from a 2.7% rise in December, with fruit and vegetable prices jumping 7.0%, driven by price rises in avocados, mangoes, cucumbers, asparagus, and tomatoes.
Housing costs also accelerated from 1.5% in December. Rents rose 5.8% annually, though the pace of growth slowed slightly from December’s 6.2% gain, reflecting improved vacancy rates in most capital cities.
New dwelling prices increased 2.0%, the slowest annual rise since June 2021, as builders offered discounts and promotions to attract buyers.
Meanwhile, automotive fuel prices declined 1.9% annually in January, following a 1.4% drop in December. On a monthly basis, fuel prices fell 1.4%, marking their first decline since October 2024.
Electricity prices played a key role in housing inflation, particularly in Queensland, where state government rebates reduced household costs. However, as some households exhausted the $1,000 rebate introduced in July 2024, electricity prices saw a smaller annual decline of 11.5% in January, compared to a 17.9% drop in December.
Marquardt explained: “Electricity rebates lower the price of electricity for households. The Queensland government introduced a one-off electricity rebate of $1,000 from July 2024. This rebate exceeded the average electricity bill for Queensland households. The impact of the rebates was lower in January than December as some households had exhausted the full value of the rebate.”
Excluding all government rebates, electricity prices would have declined 1.2% in the year to January, compared to a 0.9% fall in December.
In a separate release, total construction work increased by 0.5% to $73.94 billion in seasonally adjusted terms during the December quarter.
The rise was driven by engineering work, which grew 1.8% to $35.64 billion and is up 4.6% year-on-year.
Meanwhile, building work declined by 0.7% to $38.30 billion, marking a 0.7% decrease from the previous year.
