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Inflation edges higher as calls grow for interest rate relief

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Photo by Mikhail Nilov

Consumer prices rose 2.2 per cent in the year to November 2024, slightly above the 2.1 per cent recorded in both September and October, according to new Australian Bureau of Statistics data.

The monthly CPI indicator, which measures about two-thirds of the consumer price basket, showed price increases remained below the Reserve Bank’s forecasts.

Real Estate Institute of Australia (REIA) President Leanne Pilkington said the figures strengthened the case for interest rate cuts.

“The consistent downward trend in the figures support market expectations of a rate cut at the next RBA meeting in February which would provide a welcome relief for borrowers,” Pilkington said.

The annual trimmed mean inflation, a key measure watched by the RBA, fell to 3.2 per cent in November from 3.5 per cent in October.

Recreation and culture prices saw the largest increase at 3.2 per cent, followed by food and non-alcoholic beverages at 2.9 per cent, while alcohol and tobacco prices jumped 6.7 per cent.

Rental costs increased by 6.6 per cent over the year to November, slightly down from 6.7 per cent in October.

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The figures landed below the RBA’s forecasts of 2.6 per cent for headline inflation and 3.4 per cent for trimmed mean inflation for the December 2024 quarter.

When volatile items such as fruit, vegetables, fuel and holiday travel were excluded, the annual CPI rose 2.8 per cent in November, up from 2.4 per cent in October.

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