SYDNEY — Australia inflation cooled in November, with consumer prices up 3.4% from a year earlier after a 3.8% annual rise in October, the Australian Bureau of Statistics reported Wednesday. The easing trims pressure on the Reserve Bank of Australia, but core inflation remains above its 2% to 3% target range, keeping a February rate hike in play, Jan. 7, 2026.
The data also showed the monthly CPI was unchanged in November and that “trimmed mean” inflation — a key gauge of underlying pressure — eased to 3.2% over the year. “The 3.4 per cent annual CPI inflation to November was down from 3.8 per cent to October,” said Michelle Marquardt, the ABS head of prices statistics, in the ABS monthly CPI media release.
Australia inflation: what eased — and what didn’t
The ABS said electricity price growth slowed sharply over the year, which it linked to the timing and impact of Commonwealth and state rebates and billing effects. Some services also cooled after October’s travel-heavy spike.
But the pressure points that matter most to households — and policymakers — are still there. Housing remained the largest contributor to annual inflation, up 5.2%, and food and non-alcoholic beverages rose 3.3%.
Australia inflation and the RBA: February decision still live
The RBA’s cash rate target is 3.6% after three cuts in 2025, and officials have signaled the next move could be up if inflation re-accelerates. Reuters reported investors still saw roughly a one-in-three chance of a quarter-point hike at the next meeting despite the softer headline result.
There is another inflation read before that call. The RBA Monetary Policy Board meets Feb. 2-3, with the decision statement due Feb. 3, according to the RBA’s published schedule. The ABS is due to publish December and December-quarter CPI figures Jan. 28, and the RBA’s current setting and recent moves are listed on its cash rate target table.
Some economists argue the latest dip may not last once electricity rebates roll off and discounting fades. Westpac chief economist Luci Ellis called the numbers a “very pleasant surprise,” but said there is “a lot of noise in the data,” ABC News reported.
Looking back: the longer arc of Australia inflation
The debate over a possible hike comes after a long descent from the inflation shock earlier in the decade. The ABS’ complete monthly CPI series debuted with October’s report — showing annual inflation of 3.8% — in a separate ABS release. Further back, official quarterly data shows inflation peaked at 7.8% in late 2022, according to the ABS’ December 2022 CPI release.
As inflation cooled, the RBA began cutting rates in early 2025, including a February move that lowered the cash rate to 4.1% in its monetary policy decision statement. Whether Australia inflation is now settling back toward target — or turning sticky again — will hinge on the next CPI update and the quarterly detail that arrives before the February meeting.
