Forex

Australian Inflation Hits 4% in August Amid Housing and Transport Cost Increases

Guavy AI Editorial Team Published October 3, 2026

Instruments

AUD

Australia's annual inflation rate rose to 4 percent in August, according to official data released by the Australian Bureau of Statistics (ABS). This marks the highest inflation rate since 2023. The Consumer Price Index (CPI) increased by 4 percent over the past 12 months, up from 3.5 percent in July.

The biggest contributor to annual inflation was housing costs, which rose 5.7 percent. Transport costs also increased significantly, driven by higher fuel prices. These increases were cited as factors behind the Reserve Bank of Australia's (RBA) decision to raise its cash rate target from 4.35 percent to 4.60 percent on Tuesday.

The RBA attributed the inflationary pressures to the artificial intelligence boom and conflicts in the Middle East. Economists had generally expected annual CPI inflation to reach 4.1 percent in August, while trimmed mean inflation was forecast to remain at 3.6 percent.

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