Treasurer Jim Chalmers warned of volatile inflation figures moving forward, as the Australian Bureau of Statistics (ABS) reported that the consumer price index (CPI) rose 1.2 percent during the September quarter from the previous quarter.
The most significant price increase was seen in automotive fuel at 7.2 percent.
“Production cuts and disruptions in global oil markets are a key driver of inflation in the global economy and here at home, with Australians facing higher fuel prices at the bowser,” Mr. Chalmers said.
“We shouldn’t be surprised to see some volatility in inflation figures going forward, particularly given the global uncertainty from the conflict in the Middle East and the war in Ukraine.”
The next most significant price increase was seen in rent at 2.2 percent, ABS said. They noted that the maximum rate available for Commonwealth Rent Assistance increased by 15 percent since Sept. 20, which moderated rental price increases during the quarter.
Meanwhile, effective July 10, the amount of childcare subsidy to families increased, leading to a quarterly decline of 13.2 percent in childcare costs. The ABS noted that families incurred lower out-of-pocket costs as the amount of subsidies families received was larger than fee increases over the period, which the Labor government takes credit for.
“The Albanese government’s Cheaper Child Care changes have made early childhood education and care more affordable for around 1.2 million Australian families,” Minister for Education Jason Clare said. “These changes are cutting the cost of child care and putting downward pressure on inflation.”
Minister for Early Childhood Education Anne Aly said more accessible quality education for young children was a “big win” for families.
“Families now have greater choice when it comes to balancing the early learning needs of children along with being able to work more hours to boost household income,” she said.
Year over year, CPI jumped 5.4 percent, marking the third consecutive quarter of lower annual inflation—down from the peak of 7.8 percent in the December 2022 quarter.
Rental prices rose 7.6 percent annually, the largest annual increase since 2009, reflecting low vacancy rates due to the tight rental market in major cities.
The Reserve Bank of Australia (RBA) has not hinted yet if it would make another interest rate hike in November but its new governor, Michele Bullock, warned that rent prices will likely continue to increase.
IR Changes May Worsen Inflation, Lobby Groups Say
Business lobby groups said that the proposed industrial relations (IR) legislation changes would worsen Australia’s inflation. These proposed changes include implementation of Same Job, Same Pay and converting casual employees who have been employed for 12 months and have worked a regular pattern of schedule over the last six months into permanent staff.“The government has admitted that the Same Job, Same Pay legislation will have a deleterious impact on the cost of living, but downplays its significance,” Australian Chamber of Commerce and Industry (ACCI) chief of policy and advocacy David Alexander said.
Meanwhile, Master Builders Australia CEO Denita Wawn said the cost of building new homes continues to rise due to unnecessary delays and red tape, including planning restrictions, lengthy approval processes, and high developer fees.
