Australian Inflation Slows to 3.8% as Housing Prices Ease

Australia's annual inflation rate slowed to 3.8% in June, down from 4.0% in May, according to the Australian Bureau of Statistics (ABS). This decrease is attributed to a decline in housing and food prices, which rose by 6.8% and 3.3% respectively over the year.

The ABS reported that trimmed mean inflation, which filters out large price moves, remained at 3.6%, indicating underlying inflation has not yet returned to the Reserve Bank of Australia's target range of 2-3%. The trimmed mean is an important measure as it provides a more accurate representation of inflation trends.

The largest contributors to annual inflation were housing, food and non-alcoholic beverages, and recreation and culture. Transport prices fell by 2.7% in June, while tradable goods recorded 1.5% annual inflation compared to 4.9% for non-tradables such as housing and education.

The ABS also announced changes to the release of CPI data, with monthly releases moving to the fourth Wednesday of each month from February 2027. The next update to CPI expenditure weights will occur in January 2027.