Inflation in Australia has hit a level not seen in decades, posting the second highest quarterly increase since the introduction of the Goods and Services Tax (GST).
New data from the Australian Bureau of Statistics (ABS) showed the consumer price index, also known as CPI, rose 6.1 per cent in the 12 months to the June quarter of 2022.
Quarter-on-quarter, CPI rose 1.8 percent, the second-highest three-month jump since the introduction of GST.
Inflation is rising to a level not seen since the early 1990s. (Graph: Tara Blancato)
The last time annual inflation was 6.1% was in September 2000.
Before that, the previous high was 6.9% in December 1990.
The main contributors to the increase were new home prices (which rose 5.6 percent) and gasoline, which posted a 4.2 percent increase.
Treasurer Jim Chalmers said that while he was “not surprised to see inflation around six per cent”, the rise was “still being faced”.
This is a sentiment shared by people across the country, including Maureen and Graeme Hill.
Maureen and Graeme Hill said the cost of their groceries is rising. (9 News)
With the cost of living rising, the couple’s pension buys less with each trip to the supermarket.
“There’s nothing you look at that hasn’t gone up 50 cents…a dollar,” Maureen told 9News outside a supermarket.
The couple’s rent will also increase to about $30 a fortnight in August.
Fellow buyer John Dipalo thinks six percent is an understatement.
“Year over year, more than double digits for sure,” Dipalo said.
“So we’re definitely noticing it. (We’re) turning off the lights when we leave the rooms.”
Annual inflation soared to 6.1%, the highest rate since 2001, when prices soared following the introduction of the Goods and Services Tax. (9 News)
Unions call on government to tackle pay crisis at jobs summit in September.
“There are people who can’t afford to buy fresh fruit and vegetables for their children,” said Michele O’Neil of the ACTU.
ABS head of price statistics Michelle Marquardt said annual new property price growth was the highest seen in more than two decades.
“The annual increase in CPI is the largest since the introduction of the Goods and Services Tax (GST),” he said.
“Annual new home price inflation was the strongest on record since the series began in 1999.”
Today’s 6.1% annual increase was slightly below market expectations, which had seen a figure of up to 6.3%.
Many believed a larger-than-expected annual CPI rise would prompt the Reserve Bank of Australia to introduce an “outsized” hike at next week’s August meeting.
With today’s figure falling short of expectations, the central bank is now expected to deliver a “standard” hike of around 50 basis points.
Australians are feeling the pain of annual inflation due to rising grocery prices. (Jacky Ghossein/AFR)
Inflation is the general increase in the cost of goods and services.
The CPI is the generally accepted figure that tracks inflation in Australia.
The CPI, which is published quarterly, tracks a hypothetical “basket” of goods and services that an Australian household would or may consume.
It is then condensed into a single percentage.
Adelaide home beats expectations with $2.52 million sale