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Australia CPI rises to 4.0% as trimmed-mean inflation cools

Underlying trimmed-mean inflation slowed to 0.2% m/m, below expectations, while the gap was tied to automotive fuel and electricity excluded from the measure.

Reported · Written up by our desk · Inflation

Australia’s consumer prices accelerated in August, with headline CPI rising to 4.0% year over year from 3.5%, matching expectations. Monthly CPI also eased to 0.4% from 1.0%, in line with consensus, according to Action Forex.

The report showed more mixed inflation trends in the underlying measure. Trimmed mean CPI slowed to 0.2% month over month from 0.5%, undershooting the 0.3% expected level, while its annual rate held at 3.6% for a third consecutive month.

Action Forex said the widening gap between headline inflation and trimmed-mean inflation was largely driven by automotive fuel and electricity, which were excluded from the trimmed mean in August.

Automotive fuel prices surged 14.8% month over month after a 7.5% increase in July, reflecting higher world oil prices and the remaining unwind of federal fuel excise relief, the outlet added. The ABS also pointed to renewed headline inflation pressure without a fresh acceleration in underlying inflation.

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