The Consumer Price Index (CPI) rose 1.3 per cent through the year to September quarter 2016, according to the latest Australian Bureau of Statistics (ABS) figures. This is a rise from 1% last time, and higher than expected. However much of the rise is a reaction to recent bad wealth with the prices of fruit and vegetables higher. This is a temporary effect.
Nevertheless, the RBA trimmed mean remains at 1.7%, and probably means no rate cut in the near future.
The CPI rose 0.7 per cent in the September quarter 2016. This follows a rise of 0.4 per cent in the June quarter 2016. This quantum is towards the higher end of expectations.
Sydney had the highest movement at 1%. Housing, and furnishings helped to lift the number here, as well as rising fruit and vegetables prices.
Nationally, the most significant price rises this quarter are fruit (+19.5 per cent), vegetables (+5.9 per cent), electricity (+5.4 per cent) and tobacco (+2.3 per cent). These rises are partially offset by falls in communication (-2.3 per cent) and fuel (-2.9 per cent).
The rise in fruit and vegetable prices is due to adverse weather conditions, including floods, in major growing areas, impacting supply.
