The Most Recent Consumer Price Index (CPI) Numbers Were Made Available by the Australian Bureau of Statistics (ABS). But, It Is Necessary to Understand What Is the CPI and How Does It Function?

The ABS’s Consumer Price Index is a measure of the inflation rate experienced by households. It encompasses price changes associated with various spending categories and provides statistical data on the same.

Australia’s most popular economic measure is released quarterly, and this article presents the data from the December 2022 Quarter.

In Australia, the Consumer Price Index (CPI) is used to observe the fluctuations in the prices of goods and services purchased by households situated in the eight state and territory capitals. The CPI records the changes in the cost of the fixed selection of products and services over time.

The CPI is used to measure the inflation rate, which is the rate at which prices of goods and services are increasing. The ABS releases the CPI data quarterly and it is used by the Reserve Bank of Australia (RBA) in setting interest rates. It also helps economists understand how households are affected by changes in prices.

The CPI also plays an important role in determining wage increases and allowances for workers as it helps employers to determine how much money they should be paying their employees. It also affects pensioners who receive a cost-of-living adjustment each year based on the inflation rate.

Overall, the Consumer Price Index (CPI) is an important economic indicator that helps individuals, businesses and policy makers understand changes in prices and make appropriate decisions accordingly.

STATISTICAL HIGHLIGHTS FOR THE QUARTER ENDING IN DECEMBER OF 2022

• The Consumer Price Index (CPI) in Australia increased by 1.9% in this quarter

• Over the course of the 12 months to the December 2022 quarter, the CPI saw an overall rise of 7.8%

• The sharpest price increases this quarter included: Domestic holiday travel and accommodation (+13.3%), electricity (+8.6%), international holiday travel and accommodation (+7.6%) and the purchase of new dwellings by owner-occupiers (+1.7%).

The latest consumer price index for each month is accessible here.

HIGHLIGHTS OF THE CAPITAL CITY:

RECENT DROPS HAVE NOT BEEN ENOUGH TO BRING DOWN FUEL PRICES

At the end of the year, fuel prices had increased by 2.2%. This was predominantly due to the government bumping up the fuel excise tax from 22 cents per litre to 46 cents per litre on 30 September 2022. Prices rose in the first couple of months of the quarter, but dropped back down in December. Despite this, fuel prices at the end of the year were still 13.2% higher than they were the previous year.

INCREASES IN DISCRETIONARY SPENDING DURING THE FINAL QUARTER OF THE YEAR

At the end of the year, inflation in areas of discretionary spending surged by 2.6%, mainly because of the higher prices for holiday trips and meals at restaurants. Yearly inflation soared to a new maximum of 7.1%, however, costs for non-discretionary items remained at 8.4%.

ACROSS ALL THE MAJOR CITIES, RENTAL COSTS HAVE BEEN STEADILY INCREASING

This quarter, rents in Sydney and Melbourne have risen to their highest levels since 2014 and 2015, respectively. This is due to the extremely tight rental market. Additionally, prices in other capital cities are on the rise, further indicating that vacancies are rare.

The release date for the March Quarter has been set for April 26th, 2023.

At the end of the year, inflation in areas of discretionary spending soared to 2.6%, leading to an overall yearly maximum of 7.1%. This was driven by higher prices for holiday trips and meals at restaurants. On top of this, rental costs have been steadily rising in all major cities, with Sydney and Melbourne reaching their highest levels since 2014 and 2015 respectively due to a lack of vacancies. Despite this, fuel prices still ended up 13.2% higher than they were the previous year. The Australian Bureau of Statistics has set the release date for the March Quarter on April 26th, 2023 by transforming the structure while keeping the context intact.

For example:

The Australian Bureau of Statistics announced that the release date for the March Quarter was set for April 26th, 2023. This quarter saw a surge in discretionary spending, with inflation increasing by 2.6%. Rents in Sydney and Melbourne rose to their highest levels since 2014 and 2015 respectively, due to the tight rental market. Additionally, non-discretionary costs remained at 8.4%, higher than they were the previous year.