REIA calls for RBA action as inflation metrics show mixed signals

The Real Estate Institute of Australia has urged the Reserve Bank to consider interest rate cuts amid conflicting inflation and economic indicators.

The Consumer Price Index rose 2.1 per cent in the year to October, unchanged from September and down from 2.7 per cent in August.

“The annual movement for the monthly CPI excluding the volatile items of fruit and vegetables, automotive fuel and holiday travel and accommodation, rose 2.4 per cent in August, down from the September figure of 2.7 per cent and 3.0 per cent for August,” REIA President Leanne Pilkington said.

Rents increased 6.7 per cent over the year to November, slightly up from 6.6 per cent in September.

The most significant price rises were in recreation and culture (4.3 per cent), food and non-alcoholic beverages (3.3 per cent), and alcohol and tobacco (6.0 per cent).

While unemployment figures suggest a tight labour market, about 70 per cent of new jobs in the past year were in the public sector.

Job seekers now face longer wait times, according to SEEK’s latest Labour Market Balance Report.

“Per capita GDP figures highlight a slowing economy with six consecutive quarters of decline and a fall of 1.5 per cent in the year to June. Against this background of a slowing economy and with a consistent downward trend across the three measures of CPI, the RBA will need to act soon on interest rates given the inherent lags in the system,” Pilkington said.

The REIA represents 85 per cent of Australian real estate agencies, encompassing 46,793 businesses that employ 133,360 Australians.