Australia's CPI increases 0.6% in December 2023 quarter

01 Feb '24

2 min read

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Australia's CPI rose 0.6 per cent QoQ in December 2023, with clothing and footwear up 0.5 per cent, driven by a 1.9 per cent rise in garments.
The country's annual CPI inflation was 4.1 per cent, down from 5.4 per cent in September 2023, marking the fourth quarter of declining annual inflation from a peak of 7.8 per cent in December 2022.

Australia's consumer price index (CPI) rose by 0.6 per cent quarter-on-quarter (QoQ) in the December 2023 quarter, according to the Australian Bureau of Statistics (ABS). The clothing and footwear group saw a 0.5 per cent increase QoQ, primarily driven by a 1.9 per cent rise in garments. This increase was attributed to new summer stock entering the season. However, the overall rise was moderated by price falls in November, influenced by promotional activities including Black Friday and Cyber Monday sales.

Conversely, there were declines in the prices of accessories and clothing services (down 1.4 per cent) and footwear (down 0.6 per cent).

The annual CPI inflation for the December 2023 quarter was recorded at 4.1 per cent, a decrease from the 5.4 per cent annual rise observed in the September 2023 quarter. This trend marks the fourth consecutive quarter of diminishing annual inflation, significantly down from the peak of 7.8 per cent in the December 2022 quarter, as per ABS.

There was a notable easing in annual inflation for most goods in the December 2023 quarter. Some goods even experienced deflation, with prices lower compared to 12 months earlier, particularly in the clothing and footwear category.

Furthermore, the trimmed mean annual inflation was 4.2 per cent in the December 2023 quarter. This figure is lower than both the September 2023 quarter inflation of 5.1 per cent and the December 2022 peak of 6.8 per cent.

"The CPI rose 0.6 per cent in the December quarter, lower than the 1.2 per cent rise in the September 2023 quarter. This was the smallest quarterly rise since the March 2021 quarter. While prices continued to rise for most goods and services, annual CPI inflation has fallen from a peak of 7.8 per cent in December 2022, to 4.1 per cent in December 2023,” said Michelle Marquardt, ABS head of prices statistics.

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