09.10.202500:34:41UTC+00Australia Inflation Expectations Highest in 4 Months

In October 2025, consumer inflation expectations in Australia increased slightly to 4.8% from 4.7% the month before, reaching their highest level since June. This rise reflects growing concerns that inflation in the third quarter might surpass forecasts. The increase can be attributed to factors such as the cessation of temporary subsidies, rising labor costs due to weak productivity, and international influences, including trade disruptions and fluctuating commodity prices. In September, the central bank maintained its cash rate at 3.6%, which is the lowest since April 2023, pointing to second-quarter inflation figures that stayed within its 2–3% target range. Headline inflation during this period slowed to 2.1%, the lowest level since early 2021, while the trimmed-mean CPI—considered the Reserve Bank of Australia's preferred core measure—dropped to 2.7%, its lowest since late 2021, yet still slightly above the midpoint of the target range. However, the monthly Consumer Price Index (CPI) in August rose by 3.0% compared to the previous year, the fastest rate in 13 months, indicating a potential resurgence of price pressures as the country moves into the third quarter.