Australia's inflation rises to 3.8 pct in December

CANBERRA, Jan. 29 (Xinhua) -- Australia's annual rate of inflation increased to 3.8 percent in December, according to official figures released on Wednesday, exceeding economists' expectations.

The data from the Australian Bureau of Statistics (ABS) revealed that the consumer price index (CPI) rose by 3.8 percent in the year to December, up from 3.4 percent in the 12 months to November.

On a quarterly basis, the CPI rose by 0.6 percent in the final three months of 2025.

The Australian Broadcasting Corporation (ABC) reported earlier on Wednesday that economists were expecting CPI growth of 0.7 percent for the December quarter and an annual increase of 3.5 percent.

According to the ABC, Wednesday's inflation data was expected to determine if the Reserve Bank of Australia (RBA) raises interest rates when its Monetary Policy Board meets for the first time in 2026 on Tuesday.

The ABS said that the trimmed mean, a measure of underlying inflation preferred by the RBA, rose by 3.3 percent in the 12 months to December, up from 3.2 percent in November and above the central bank's target band of 2-3 percent.

Projections released by the RBA in November said it expected CPI growth of 3.3 percent in the year to December and trimmed mean growth of 3.2 percent.

Michelle Marquardt, head of prices statistics at the ABS, said on Wednesday that housing was the largest contributor to annual headline inflation in the 12 months to December, followed by food and non-alcoholic beverages and recreation and culture.■