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ForexMediumUpdated×2•Originally published 26 August 2026•Updated 26 August 2026•
1 min read

Australia Core CPI Sticky at 3.6% Despite Headline Inflation Easing

Key Facts

1Australia's annual CPI eased to 3.5% in July from 3.8% in June, but remained above the 3.2% consensus forecast.
2The Trimmed Mean CPI, a key core inflation measure, held steady at 3.6% y/y, exceeding expectations of 3.5%.
3Monthly CPI rose by 1.0% in July following a 0.1% contraction in June.

Amid persistent price pressures that challenge central bank efforts to stabilize the economy, Australia's annual CPI eased to 3.5% in July from 3.8% in June, though it remained above the 3.2% consensus forecast. According to reports, the Trimmed Mean CPI, a critical core measure, held steady at 3.6% y/y, exceeding expectations of 3.5%. Monthly CPI rose by 1.0% in July, reversing a 0.1% contraction seen in the previous month.

The data highlights a complex inflationary environment where housing remained the largest annual contributor, rising 5.0% y/y as new dwelling prices climbed 5.7% due to higher material and labor costs. Per market analysis, transport inflation accelerated sharply from 0.1% to 1.6% y/y, fueled by a 7.5% monthly jump in automotive fuel prices, while food and non-alcoholic beverages rose by 3.2%.

Looking ahead, the 'sticky' nature of underlying inflation supports a hawkish stance from the Reserve Bank of Australia (RBA).

Latest Updates · 1

  1. Notable·

    Update: The hotter-than-expected inflation data has bolstered bets on a sustained hawkish stance by the Reserve Bank of Australia (RBA), providing immediate upward support for the AUD/USD exchange rate. Analysts suggest that sticky core inflation reduces the likelihood of near-term rate cuts, enhancing the Australian dollar's appeal against major peers.