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Mild June CPI suggests no change to interest rates

Posted on : Thursday, 27 July 2017

The All Groups Consumer Price Index rose at a mild pace of 0.2% in the June quarter, according to the latest ABS numbers, a dip from the previous quarter's 0.5% increase. That result puts the 12-month CPI at 1.9%, slightly below the Reserve Bank's target of 2-3%. The Australian dollar eased on the news, and the numbers suggest the central bank is unlikely to change interest rates.

 

The most significant price rises over the June quarter were for medical and hospital services (+4.1%), new dwellings (+0.9%), tobacco (+1.0%) and beer (+1.0%).

 

The overall health group, which includes medical and hospital services, rose 2.7%, the most significant positive contributor to the All Groups quarterly movement across all eight capital cities. This was largely driven by an annual increase in private health insurance costs.

 

Meanwhile, the most significant offsetting price falls were domestic holiday travel (-3.2%), automotive fuel (-3.2%) and fruit (-4.4%). With respect to the food indicator, the ABS is monitoring the impact of Cyclone Debbie on fruit and vegetable prices and while some strong price rises were recorded in some areas, these were offset by falls in seasonally available fruits.

 

All Groups CPI for the June quarter rose in five out of eight capital cities, with Perth, Hobart and Canberra recording no movement. Over the 12 months to June 2017, Hobart (+2.3%), Melbourne (+2.2%) and Sydney (+2.2%) recorded the largest positive movements.

 

CAPITAL CITY COMPARISON

Percentage Change: (a) Previous Financial Year; (b) Previous Quarter of Previous Year:

Period

Sydney

Melbourne

Brisbane

Adelaide

Perth

Hobart

Darwin

Canberra

All

(a)     Percentage Change from Previous Financial Year:

2013-14

2.5%

2.7%

2.8%

2.5%

3.0%

2.5%

3.7%

2.3%

2.6%

2014-15

2.0%

1.4%

1.8%

1.5%

1.8%

1.2%

1.4%

1.1%

1.7%

2015-16

1.5%

1.6%

1.6%

0.8%

0.9%

1.3%

0.1%

0.8%

1.4%

2016-17

2.0%

1.8%

1.8%

1.6%

0.6%

1.8%

0.2%

1.9%

1.8%

(b)     Percentage Change from corresponding Quarter of previous year

2014

 

 

 

 

 

 

 

 

 

March

2.8%

2.8%

3.1%

2.9%

3.1%

2.8%

3.6%

2.6%

2.9%

June

2.8%

3.2%

3.2%

3.1%

3.3%

2.8%

3.3%

2.2%

3.0%

Sept.

2.2%

2.0%

2.6%

2.1%

2.6%

1.9%

2.7%

2.0%

2.3%

Dec.

1.7%

1.4%

2.0%

1.7%

2.0%

1.1%

1.9%

1.2%

1.7%

2015

 

 

 

 

 

 

 

 

 

March

1.6%

1.0%

1.4%

1.1%

1.4%

0.9%

0.8%

0.6%

1.3%

June

2.2%

1.1%

1.5%

1.2%

1.2%

0.6%

0.2%

0.8%

1.5%

Sept.

1.9%

1.4%

1.5%

1.1%

1.1%

1.1%

0.4%

0.6%

1.5%

Dec.

2.0%

1.9%

1.7%

1.0%

1.5%

1.8%

0.5%

0.7%

1.7%

2016

 

March

1.3%

1.7%

1.7%

0.7%

0.7%

1.3%

-0.3%

1.0%

1.3%

June

0.9%

1.4%

1.5%

0.7%

0.5%

1.2%

0.0%

0.8%

1.0%

Sept.

1.7%

1.4%

1.5%

1.2%

0.5%

1.3%

0.0%

1.4%

1.3%

Dec.

1.8%

1.5%

1.6%

1.3%

0.4%

1.3%

-0.4%

1.8%

1.5%

2017

 

 

 

 

 

 

 

 

 

March

2.4%

2.5%

1.8%

2.0%

1.0%

2.3%

0.5%

2.3%

2.1%

June

2.2%

2.2%

1.8%

1.6%

0.7%

2.3%

0.5%

2.1%

1.9%

 

Source: Australian Bureau of Statistics, Catalogue 6401.0 (26 July 2017)