Total
0
Shares
APN Convenience Retail (ASX:AQR) raises $35M to buy service stations
Market Herald logo

Subscribe

Be the first with the news that moves the market
  • Rallying oil prices spur the Australian Consumer Price Index 0.8 per cent on the previous quarter, while a 3.8 per cent yearly increase reflects an economy adjusting to the post-pandemic era
  • Increases across automotive, medical and fresh food prices drove inflation upwards over the quarter
  • ABS Head of Prices Statistics Michelle Marquardt says the rise was significantly influenced by one-off COVID-19 related price changes
  • Trimmed mean inflation was 1.6 per cent through the year, up from 1.1 per cent in the March 2021 quarter

The Australian Consumer Price Index has risen 0.8 per cent on the previous quarter — thanks to swelled oil prices — and 3.8 per cent for the year as the economy readjusts to a post-pandemic era.

The Australian Bureau of Statistics mainly attributed the moderate inflation over the quarter to rising fuel prices, which triggered a 6.5 per cent rise in the automotive sector over the period.

WIT crude prices rallied over June before closing the month at $73.47 per barrel, although prices have cooled off slightly through July.

Medical and hospital services grew 2.4 per cent on account of an increase in private health insurance premiums.

Fruit, vegetable and beef prices were pushed up due to floods in growing regions and a shortage of pickers, as Australia's closed borders hinder an industry typically reliant on workers from overseas.

While the yearly increase may seem sharp, ABS Head of Prices Statistics Michelle Marquardt said the rise was significantly influenced by one-off COVID-19 related price changes.

"Key drivers included the full unwinding of the Federal Government's free childcare package implemented in the June quarter last year, as well as a full return from the drop in fuel prices seen in the same quarter," she said.

"In situations such as this, it is useful to consider underlying inflation measures such as the trimmed mean, which are designed to remove large, one-off price impacts."

Trimmed mean inflation was 1.6 per cent through the year, up from 1.1 per cent in the March 2021 quarter.

Innes Willox, Chief Executive of the national employer association Ai Groupn said employers may want to hold off before considering any wage or price increases.

"While the 3.8 per cent increase in the CPI for the year to the end of June 2021 appears high, it is to a large extent due to the reversal of some deflationary forces of a year ago," he said.

"The more robust indication of consumer prices is that the CPI rose by 1.9 per cent in the five quarters from March 2020 to June 2021.

"This is a more reliable benchmark for businesses considering any wage or price increases."

More From The Market Herald
Retail investors not highly engaged with funds management: ASIC

" Retail investors not highly engaged with funds management: ASIC

Australia’s corporate watchdog released today a report on the condition of competition in Australia’s funds management industry, revealing that retail investors are mostly
Mining sector a double-edged sword in WA’s efforts to diversify

" Mining sector a double-edged sword in WA’s efforts to diversify

For decades Western Australians have advocated for the diversification of an economy dominated by the mining sector, whose strength represents both headwinds and
ASIC targets pump and dump groups on social media

" ASIC targets pump and dump groups on social media

Australia’s market regulator has sounded the alarm on “a concerning trend” of social media posts being used to artificially inflate the value of
US to donate 500m more COVID-19 vaccine doses to poorer nations

" US to donate 500m more COVID-19 vaccine doses to poorer nations

Facing pressure to share its COVID-19 vaccine supply with the rest of the world, the United States has this week announced another 500...