Australia’s headline CPI rose 1.3 per cent over the quarter and 3.5 per cent over the year in Q4:2021.  The rate of quarterly increase was up from 0.8 per cent in the two previous quarters as inflation picked up at the end of last year.  

Headline inflation has now been at or above the top of the target band for the past three quarters. At the same time, underlying inflation – as measured by the trimmed mean – rose to an annual rate of 2.6 per cent in the December quarter, the highest result since June 2014. Quarterly growth was also a strong one per cent. The trimmed mean has now been in the RBA’s target range for two consecutive quarters. This strong inflation reading has prompted the RBA to upgrade its inflation forecasts and encouraged financial markets to expect a more aggressive central bank approach to normalising monetary policy settings.

Please click here for the latest version of our inflation chart pack. As well as detailed charts on the December quarter 2021 CPI release it also includes the RBA’s latest (February 2022) inflation and labour market forecasts plus a review of recent data on inflation expectations and on inflation developments at the global level.

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