Electricity prices jump
After two low quarters of headline inflation at 0.2 per cent, the March quarter revealed headline inflation at 0.9 per cent as electricity subsidies were unwound (electricity prices jumped back 16.3 per cent higher over the quarter, largely driven by prices in Brisbane).
Over the year inflation has moderated, at 2.4 per cent.
Looking through the noise, the closely watched trimmed mean inflation came it at 0.68 per cent for the March quarter, following on from 0.54 per cent in the preceding quarter.
This was in line with Reserve Bank forecasts, which is what really matters in the end, while the 2-quarter annualised figure for trimmed mean inflation has also dropped to 2.4 per cent.
Looking ahead, we should get lower
fuel prices in the June quarter, while rental price inflation will also continue to fall from here (and new dwelling price inflation has also slowed from above 20 per cent to zero).
The strongest rental price inflation over the past year was still seen in Perth (8.9 per cent), but the volatility associated with Perth's boom-bust cycles over the past quarter-century means that cumulatively rental price growth has actually been lower than that experienced in other capital cities.
It's also interesting to note just how similar inflation rates have been around much of the developed world, recently herding together at about 2½ per cent over the year to March.
The wrap
Overall, inflation was a bit higher than expected in the March quarter, but not alarmingly so, and markets are pricing an interest rate cut in May (and four cuts in total over the remainder of 2025).
James Foster took a
look at the details here, and showed how - despite high increases in education costs - services price inflation has now eased back.
In other news, the Australian Bureau of Statistics reported that the overseas born population in Australia jumped to 31.5 per cent (or 8.6 million) in FY2024, up from 30.7 per cent in FY2023.
This is the highest share of overseas-born Aussies in over 120 years.
The growth over the past decade has mostly been due to Indian-born residents (comfortably more than doubling from 411,000 to 916,000, and soon to surpass England as the number one overseas country of birth as more of the Ten Pound Poms generation drops off).
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