Inflation has jumped to 3.2% in the year to September, from 2.1% in June, as waning government subsidies feed through to higher household power bills.<\/p>\n
Any lingering chance of a rate cut next Tuesday \u2013 or this year \u2013 was squashed after the new Australian Bureau of Statistics figures also confirmed the first rise in underlying inflation in nearly three years.<\/p>\n
The Reserve Bank\u2019s preferred trimmed mean measure \u2013 which removes the impact of large, temporary price moves \u2013 climbed by 1% in the three months to September and far ahead of the RBA\u2019s predicted rate of 0.6%.<\/p>\n
Sign up: AU Breaking News email<\/a><\/p>\n That left inflation on this trimmed mean measure at 3% in the year, against 2.7% in June.<\/p>\n Graph showing the headline and underlying rates of inflation.<\/a><\/p>\n It was the first rise in underlying inflation since late 2022 and will trigger alarm bells at the central bank before its two-day monetary policy board meeting on Monday.<\/p>\n Predictions for a fourth rate cut are likely to be pushed back to 2026.<\/p>\n The resurgence in inflation \u201cprovides the justification for the RBA to sit on its hands in relation to further rate relief\u201d, the KPMG chief economist, Brendan Rynne, said.<\/p>\n But Rynne said more rate cuts were still \u201cabsolutely needed\u201d to kickstart the economy as government support wanes.<\/p>\n \u201cWe knew there was going to be an uptick in inflation once electricity rebates were wound back but unfortunately today\u2019s spike is much higher than any of us anticipated,\u201d he said.<\/p>\n The ABS said the main contributor to the headline annual inflation rate was a 24% rise in electricity prices.<\/p>\n Household power bills<\/a><\/p>\n This was \u201cprimarily related to households in Queensland, Western Australia and Tasmania having higher out-of-pocket costs\u201d than during the same period last year, the ABS said.<\/p>\n skip past newsletter promotion<\/a><\/p>\n Sign up to Breaking News Australia<\/p>\n Get the most important news as it breaks<\/p>\n Privacy Notice: Newsletters may contain information about charities, online ads, and content funded by outside parties. If you do not have an account, we will create a guest account for you on theguardian.com<\/a> to send you this newsletter. You can complete full registration at any time. For more information about how we use your data see our Privacy Policy<\/a>. We use Google reCaptcha to protect our website and the Google Privacy Policy<\/a> and Terms of Service<\/a> apply.<\/p>\n after newsletter promotion<\/p>\n Petrol prices fell but there was plenty of evidence that the cost of living is continuing to bite.<\/p>\n Grocery items were 3.1% higher in the year to September, including a 15% rise in coffee, tea and cocoa prices due to issues with overseas suppliers of coffee beans.<\/p>\n Michele Bullock, the RBA\u2019s governor, this week made it clear that a quarterly rise in underlying inflation of 0.9% would be a \u201cmaterial miss\u201d, signalling the monetary policy board would not be prepared to deliver a fourth rate cut.<\/p>\n While Australians will feel the bite of higher electricity prices, what has been more concerning for the central bank is the unexpected and unwelcome lift in underlying inflation.<\/p>\n Bullock this week made it clear<\/a> that the central bank is, for now, more worried about the prospect of resurgent inflation than a recent jump in unemployment<\/a>.<\/p>\n Bullock said the labour market was not about to \u201cfall off a cliff\u201d and that the jobless measure was \u201cstill pretty low\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"Inflation has jumped to 3.2% in the year to September, from 2.1% in June, as waning government subsidies…\n","protected":false},"author":2,"featured_media":231164,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":{"0":"post-231163","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-uk","11":"tag-united-kingdom","12":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/231163","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=231163"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/231163\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/231164"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=231163"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=231163"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=231163"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}