Australia’s inflation accelerated again in September. The consumer price index rose 4.3 percent in the 12 months to September 2026, up from 4.0 percent in the 12 months to August and above the 4.2 percent market forecast, the Australian Bureau of Statistics said on Wednesday. Prices rose 0.8 percent in the month, against a 0.7 percent forecast and a 0.4 percent rise in August, and the September quarter index rose 1.3 percent.
Housing was the largest contributor to annual inflation, rising 5.2 percent in the year, on higher costs for new dwellings and electricity. New dwelling prices rose 4.7 percent in the year to September as builders passed on higher materials and labour costs, down from 5.4 percent in the year to August. Transport was the second largest contributor, rising 8.7 percent in the year on higher automotive fuel prices: fuel rose 9.4 percent in September alone, after a 14.8 percent rise in August, driven, the bureau said, by higher world oil prices.
The underlying measures give the Reserve Bank no relief. Trimmed mean inflation was 3.6 percent in the year to September, and the bureau revised the August figure down to 3.5 percent from the 3.6 percent released last month after a change in seasonal factors, which means underlying inflation ticked up on the revised series rather than holding flat. In the September quarter the trimmed mean rose 1.0 percent. That matches the top of the big four banks’ forecasts of 0.9 to 1.0 percent and sits above the roughly 0.8 percent quarterly pace implied by the RBA’s August forecasts. Both headline and trimmed mean are also running above the bank’s year end forecasts of 3.6 percent and 3.3 percent.
The release is the last major data point before the RBA board meets on November 2 and 3. The cash rate stands at 4.60 percent after the September 29 rise, the fourth this year, and Deputy Governor Andrew Hauser said on October 21 that the inflation outlook looks materially worse than the bank assessed in August. ANZ and Westpac expect a fifth rise, to 4.85 percent, CBA and NAB expect a hold, and Goldman Sachs moved to a rise call after Hauser spoke. Market pricing put the odds of a November rise above one half going into the release, and the pre-release market commentary had set the test plainly: a quarterly trimmed mean at or above 1.0 percent would push that pricing closer to fully priced. The counterweight is the labour market, where employment fell 39,300 in September and unemployment held at 4.7 percent.
The Australian dollar rose on the release, with AUD/USD up 0.19 percent at 0.7043 shortly after publication, from just above 0.7000 before it. The decision is announced at 2:30 p.m. Sydney time on November 3.