FX.co ★ Australia’s Inflation Gauge Picks Up Again in September

Australia’s Monthly Inflation Gauge, prepared by the Melbourne Institute, increased by 0.4% in September 2025, after experiencing a 0.3% decline in the previous month. This rebound suggests that third-quarter inflation figures may exceed expectations, despite the Reserve Bank of Australia's efforts to maintain price growth within its 2–3% target range. The central bank maintained the cash rate at 3.6% in September, warning that inflation had persisted more than anticipated, particularly in market services, amidst a tight labor market. The board has reduced rates on three occasions this year, each following the release of quarterly inflation data, to bolster economic growth. Although Australia's annual inflation rate dropped to 2.1% in the second quarter of 2025, marking the lowest level since early 2021, the monthly Consumer Price Index saw a significant increase of 3.0% year-on-year in August, marking a 13-month high due to the cessation of state electricity rebates.