ABS data shows that the Consumer Price Index (CPI) rose 1.9% in the December 2022 quarter and 7.8% over the twelve months. The annual CPI movement of 7.8 per cent is the highest since 1990.
“Whilst this is up on the annual figure for the September quarter of 7.3% it is in line with the Budget forecast of 7.75% and just below the RBA’s forecast of 8.0% and points to a slowing down in the rate of increase”, said REIA President, Hayden Groves.
“The largest most significant price rises were for domestic holiday travel and accommodation (13.3%), electricity (+8.6%) and international holiday travel and accommodation (7.6%).
“High labour and materials costs continue to drive increases in prices for new dwellings. With a quarterly increase of 1.7% indicating that the rate of price growth has started to ease over recent quarters following a record annual rise in the September 2022 quarter.
“Rents increased by 4.0% annually on a weighted capital city basis compared to 2.8% for the twelve months to September. In Sydney and Melbourne the annual increases were 3.3% and 2.2%, respectively. These are the largest annual increases since 2014 and 2015. Annual growth in rent prices for the remaining capital cities continues to outpace price growth in Sydney and Melbourne.
“Trimmed mean annual inflation, which excludes large price rises and falls, increased to 6.9 per cent, the highest since the ABS first published the series in 2003.
“With the CPI having peaked within forecasts it is time for the RBA to listen to the chorus of economists calling for a pause on interest rate hikes at its February meeting and assess the lagged impact that past increases have had and not run the risk of grinding the economy to a standstill,” concluded Mr Groves.
