Australia: Inflation falls to multi-year low in Q1
April 27, 2016
In the first quarter of 2016, consumer prices fell 0.2% over the previous quarter, undershooting market analysts’ expectations of a 0.3% increase and contrasting Q4 2015’s 0.4% increase. The surprise decrease marked the lowest reading since Q1 2002. The Australian Bureau of Statistics elaborated that falling prices for automotive fuel, fruit, as well as international holiday travel and accommodation registered the most significant decreases in Q1. These drops were partially offset by increasing prices for secondary education, medical and hospital services, and pharmaceutical products.
Inflation came in at 1.3% in Q1, down from 1.7% in Q4, which marked the lowest reading in almost four years. Despite lower inflation in Q1, annual average inflation was steady at Q4’s 1.5%, below the Reserve Bank of Australia’s inflation target of 2.0%–3.0%.
Author: Robert Hill, Economist