The ABS has released its monthly inflation indicator for July, which has undershot economists’ expectations.
CPI inflation fell to 4.9% year-on-year in July, down from 5.4% in June and below expectations of a 5.2% rise:
However, when excluding volatile items, core inflation only fell to 5.8% in July, compared to 6.1% in June.
Soaring energy and rent costs continue to keep inflation elevated, according to the ABS:
“The annual increase for Housing of 7.3% was slightly lower than the 7.4% increase in June. New dwelling prices rose 5.9%, which is the lowest annual rise since October 2021, as building material price increases continued to ease. Rent prices rose 7.6% in July, up from 7.3% in June, as the rental market remains tight”.
“Electricity prices rose 15.7% in the 12 months to July and increased 6.0% in the month of July. These increases reflect price reviews across all capital cities. Rebates introduced from July reduced the impact of electricity price increases for eligible households”.
The below charts show Australia’s energy policy failures in all of their hideous glory.
Electricity prices have soared:
Driven primarily by soaring gas prices:
Regardless, there should be enough inflation moderation in this release to stay the RBA’s hand with respect to interest rates.
