Since inflation began to rise in late 2020, and peaking at 7.8% in December 2022, the Reserve Bank of Australia (RBA) continues to keenly observe how rising inflation is impacting the costs of everyday goods and services, both domestically and abroad. Seeking to bring inflation to within its target range between 2 -3 percent by adjusting the cash rate.
Recent Monthly Inflation data (which only looks at around two-thirds of the items included in the quarterly CPI basket) for the month of November 2023 fell a further 0.6%, to be at 4.3%, continuing its downward trend.
This continuing trend towards the target range should influence the RBA to continue to hold the cash rate firm in their next meeting on the first Tuesday of February.
Further supportive data in holding the cash rate firm is the changes in the national employment data. While the national unemployment rate has remained steady at 3.9%, the configuration of Australian employment is important. Full time jobs fell by 106,600 positions, with Part time positions up by 41,400 and the participation rate fell slightly. With job advertisements continuing to fall, the overall labour market is showing consistent signs that it is easing, placing lower inflationary pressures from wages growth, which is the RBA desired outcome.
Written by McGees Property Brisbane Valuations
Scott Campbell and Owen Thorn