New figures from the ABS show that headline inflation at 2.8 per cent is now the lowest it has been in almost four years.
We are making welcome and encouraging progress in the fight against inflation, but we know Australians are still doing it tough.
We’re coming at this at this inflation challenge from every conceivable and responsible angle and our efforts are making a difference.
Underlying inflation is now at its lowest in almost three years and almost half its peak. Trimmed mean inflation was 3.5 per cent over the year to the September quarter 2024, down from 4.0 per cent over the year to June quarter.
Headline inflation is now back in the RBA’s target band for the first time since 2021.
When we came to office inflation was much higher and rising, now it is lower and falling.
Inflation was 6.1 per cent at the time of the election and is now 2.8 per cent.
Monthly inflation was 2.1 per cent in the year to September 2024, down from 2.7 per cent in August and around a third of the 6.1 per cent at the time of the election.
This is the lowest monthly inflation in more than three years.
Inflation is now much less than half of what we inherited and around a third of its peak.
Our policies, including energy rebates, are making a meaningful difference and helping in the fight against inflation but they don’t explain all the moderation in today’s figures.
Headline inflation was 0.2 per cent in the quarter – the lowest result in more than four years and a less than a tenth of the 2.1 per cent in the quarter just before the last election.
Annual non‑tradable inflation recorded its fastest moderation in almost three years. Non‑tradable inflation was 4.1 per cent over the year to the September quarter 2024, down from 5.0 per cent through the year to June quarter.
Services inflation was 4.6 per cent over the year to the September quarter 2024, up from 4.5 per cent over the year to the June quarter. Australia’s services inflation is lower than many comparable economies including the US and the UK.
Today’s numbers show we are on track and on target for a soft landing in our economy.
We are confident but not complacent about the progress that we are making.
Inflation is back in the band, our back‑to‑back surpluses are helping, and we’re rolling out responsible cost of living relief which is making a difference.
The volatility in global oil prices we’ve seen in recent weeks is a reminder that we’re not immune from what’s going on around the world.
We recognise that there are pressures coming at us from here and abroad, including from higher interest rates and global uncertainty, and that’s why we are doing something about it.
We’ve delivered the first back to back surpluses in almost two decades which the RBA Governor has said are helping in the fight against inflation.
The data shows that our policies took half of a percentage point off annual inflation in the quarter.
In the year to the September quarter 2024, electricity prices fell 15.8 per cent, and would have fallen 2.7 per cent without the energy rebates we are rolling out with the states.
In the year to the September quarter 2024, rents rose 6.7 per cent – without the largest increase to Rent Assistance in 30 years, they would have risen 8.5 per cent. The data today is before the full impact of our second boost to Commonwealth Rent Assistance came into effect.
The Government’s number one priority is getting on top of our inflation challenge without ignoring the risks to growth, and providing responsible cost of living relief where we can.
The COVID‑19 inquiry, released yesterday, underscored the importance of our responsible approach to economic management.
Modelling cited in the report suggested that peak inflation could have been at least 2 percentage points lower if the policy settings had better matched the public health restrictions.
Inflation has moderated substantially in Australia but unlike many countries around the world we’ve managed to achieve that moderation while also overseeing the creation of a million new jobs, delivering one of the strongest budget positions in the G20, getting real wages growing again, and delivering a tax cut to every taxpayer.