Falling fuel prices had put downward pressure on Australia’s inflation in the year to June.
According to the June quarter CPI inflation release from the Australian Bureau of Statistics (ABS):
“Automotive fuel prices fell 0.7% for the quarter. Compared to the June 2022 quarter, unleaded petrol prices are 3.2% lower and diesel prices are 10.1% lower”:
The situation has darkened in recent weeks with fuel prices rising to near record highs across Australia.
The below chart from CommSec illustrates the situation:
As you can see, average petrol prices across Australia have breached $2 per litre – close to record highs.
As Tarric Brooker notes on Twitter, “if current trends continue base effects on petrol prices are going to add further fuel to Australian inflationary pressures in Q3 and Q4”.
This definitely bears watching and could contribute to Australia’s inflation remaining sticky and the RBA keeping rates higher for longer.
