- CPI rose by 1.8% during the September quarter
- The inflation figures are the highest since the GST was introduced in 2000
- Goods have also increased by their highest level since 1983
Inflation continues to rise, with the cost of new dwellings (+ 20.7%) and automotive fuel (+18%) leading the drive over the past year.
The Consumer Price Index rose 1.8% during the September 2022 quarter, taking the annual rate to 7.3% according to the latest data from the Australian Bureau of Statistics (ABS).
“This quarter’s increase matches that of last quarter and is lower than the 2.1 per cent result in March quarter this year,” said Michelle Marquardt, Program Manager of Prices at the ABS.
“All three results exceed any other quarterly results since the introduction of the Goods and Services Tax (GST), and underlie the highest annual increase in the CPI since 1990.”
A rise in new dwellings (+3.7%), gas (+10.9%) and furniture (+6.6%) were the most significant contributors to the September quarter rises.
“Labour shortages in the house construction industry, leading to rises in labour costs, contributed to the rise in new dwellings this quarter,” Ms Marquardt said.
“The continuation of material shortages added further price pressure.
“However, the rate of price growth in new dwellings eased relative to recent quarters (+5.6 per cent and +5.7 per cent in June and March quarters), reflecting a softening in new demand and some easing in supply constraints.
“Annual gas price reviews across the states and territories saw higher wholesale gas prices passed on to consumers in the September quarter.
“Electricity rose 3.2 per cent this quarter, with rises across the country offset by the Western Australian Government’s $400 electricity credit, and smaller credits offered by the Queensland and Australian Capital Territory Governments. Excluding the effect of these schemes, electricity would have risen 15.6 per cent in the quarter.”
Food also on the rise
Food prices have continued to rise, 3.2% during the quarter, driven by meals out and takeaway food (+2.9%) thanks to the increased ingredient, wage and transportation costs.
Fruit (+6.6%) and vegetables (+2.9%) continued to rise during the quarter due to higher input costs and weather-damaged crops, although vegetable prices eased.
Automotive fuel decreased by 4.3%, partially offsetting the overall rise. This comes as crude oil prices have fallen globally.
On an annual basis, new dwellings have risen by 20.7% and automotive fuel by 18%.
“For the second consecutive quarter, annual price inflation for new dwellings was the strongest recorded since the series commenced in 1999, as high material and labour costs mingled with high demand”, said Ms Marquardt.
“Fewer grant payments from the Federal Government’s HomeBuilder and similar state-based housing construction programs compared to the same time last year also contributed to the annual increase. Excluding the impact of the reduction in grant payments made, new dwellings would have recorded an annual rise of 17.7 per cent.”
The annual increase in the price of goods (+ 9.6%) is the highest since 1983, rising much more strongly than that of services (+4.1%).
Non-discretionary goods and services have both risen by 8.4%, while discretionary has risen by 5.5%.
