February saw no change in the yearly rate of inflation, which remained 3.4%.

The most recent data from the Australian Bureau of Statistics (ABS) shows that in the 12 months leading up to February 2024, the monthly Consumer Price Index (CPI) indicator increased by 3.4%.

Michelle Marquardt, ABS head of prices statistics, said: “Annual inflation was unchanged in February and has been 3.4 per cent for three consecutive months”. 

The most significant contributors to the February annual increase were Housing (+4.6 per cent), Food and non-alcoholic beverages (+3.6 per cent), Alcohol and tobacco (+6.1 per cent) and Insurance and financial services (+8.4 per cent).

"CPI inflation is often impacted by items with volatile price changes like Automotive fuel, Fruit and vegetables, and Holiday travel. It can be helpful to exclude these items from the headline CPI to provide a view of underlying inflation. 

"When excluding these volatile items from the monthly CPI indicator, the annual rise to February was 3.9 per cent, down from 4.1 per cent to January. Annual inflation excluding volatile items has continued to slow over the last 14 months from a high of 7.2 per cent in December 2022,” Ms Marquardt said.

Housing increased 4.6% in the year ending in February, staying constant from January. A tight rental market and low vacancy rates nationwide are reflected in the 7.6% annual increase in rents within the housing sector, up from 7.4% in January. The cost of building materials and labour increased, which resulted in a 4.9% annual increase in the price of new homes. For the last six months, the annual growth rate for new homes has hovered around 5%. Food and non-alcoholic beverage price increases decreased this month. The annual increase in January was 4.4%, so the 3.6% rise in the year ending in February was less than that. The price increases this month represent the lowest annual growth since January 2022, with prices moderating or even declining in most food categories, including fruit and vegetables and meat and seafood.

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