Inflation lifted 3.8 per cent in the 12 months to October<\/a>, exceeding expectations and effectively killing hopes for any future rate cuts.<\/p>\nThe October rise follows inflation jumping to 3.6 per cent in September.<\/p>\n
EQ Economics\u2019 managing director Warren Hogan said the cyclical nature of inflation meant the RBA was now forced to tackle the price rises.<\/p>\n
\u201cThe key point is that we’re now seeing inflation look like it’s rising,\u201d he told Business Now.<\/p>\n
\u201cAfter the quarterly numbers, inflation had stopped falling at about three per cent, but this really tells us that it looks like it’s rising.<\/p>\n
\u201cWe know the economy’s starting to pick up, so inflation’s very cyclical and it’s probably going only in one direction, which is going to bring the RBA back into play to get on top of it.<\/p>\n
\u201cThey have to get rates up to get inflation down.\u201d<\/p>\n
The RBA has cut rates three times since the beginning of the year after inflation fell back into the central bank\u2019s two-three per cent target band.<\/p>\n
However, a spike in the second half of this year has put hopes of further easing on the back burner and sparked fears of more hikes.<\/p>\n
Mr Hogan said the RBA was unlikely to move the cash rate this year, but predicted it could move in the early months of 2026.<\/p>\n
\u201cI don’t think they’re gonna hike rates in December,\u201d he said.<\/p>\n
\u201cIt’s just too hard for them. It’s too much noise (and) too much backlash in the community.<\/p>\n
\u201cBut if they’re in a position where they might have to in February, they’ve got to start laying the groundwork for that (and) start letting people know that this could be coming.\u201d<\/p>\n
This month marks the first time the Australian Bureau of Statistics has delivered a full monthly consumer price index, allowing the Reserve Bank of Australia to have more immediate inflation data to inform its rate calls.<\/p>\n
The largest contributors to inflation\u2019s rise were housing, up 5.9 per cent, while food and non-alcoholic beverages and recreation and culture both rose 3.2 per cent.<\/p>\n
Electricity costs spiked 37.1 per cent in the 12 months to October, as various state government rebates were used up by households and the impact of the Commonwealth Energy Bill Relief Fund rebates rollout subsided.<\/p>\n
However, on a monthly basis electricity prices fell 10.2 per cent in October.<\/p>\n
Trimmed mean inflation – the middle 70 per cent of price changes core to the RBA’s rate call – rose to 3.3 per cent from 3.2 per cent in the month prior.<\/p>\n
This was well outside the RBA’s two-three per cent target band.<\/p>\n
Despite the large rise over the past 12 months, inflation was unchanged on a monthly basis in October.<\/p>\n","protected":false},"excerpt":{"rendered":"The Reserve Bank of Australia has \u201cto get rates up\u201d to stamp out the resurgence of inflation, a…\n","protected":false},"author":2,"featured_media":311072,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,21450,164,5465,7054,183,90107],"class_list":["post-311071","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-cpi","tag-economy","tag-inflation","tag-rba","tag-reserve-bank-of-australia","tag-warren-hogan"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/311071","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=311071"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/311071\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/311072"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=311071"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=311071"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=311071"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}