New economic data reveals a rise in headline inflation, casting doubt on the possibility of an early interest rate cut in Australia.
Aussies hoping for quick financial relief have been left waiting as new economic data has dampened hopes of an immediate rate cut in an election year where cost-of-living and price pressures will be at the forefront. Headline inflation rose by 2.3 percent in the 12 months to November amid the dwindling impacts of electricity rebates. The new figure from the Australian Bureau of Statistics comes as many Aussies eagerly await an interest rate drop this election year.
In its latest update, the ABS revealed headline inflation jumped 0.2 percent, while trimmed mean inflation - the Reserve Bank of Australia's preferred measure which eliminates volatile price changes - fell to 3.2 percent. Driving the rise in headline inflation was the 'timing of electricity rebates', ABS head of price statistics Michelle Marquardt said on Wednesday. “In some states and territories, households received two rebate payments in October in lieu of not receiving a payment in July,' Ms Marquardt said. 'From November most households received one payment. As a result, electricity prices fell 21.5 percent in the 12 months to November, compared to a fall of 35.6 percent to October.” Power prices were 21.5 percent lower in November 2024 than 12 months prior, but would have only dropped just 1.7 percent without the rebates. This whopping drop was still an increase from October when prices fell 35.6 percent due to the timing of the federal power rebates. Alongside electricity, a substantial fall in new dwellings prices to 2.8 percent marked the biggest drop since July 2021. This change, alongside the drop in underlying inflation, was a sign the Australian economy was on the mend, State Street’s APAC Economist Krishna Bhimavarapu sai
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