CPI returned to 4% in August

Housing and transport are being identified as the biggest drivers of the latest consumer price index figures within broader cost-of-living pressures and ongoing financial dynamism.

On the back of a five-year unemployment high and another cash rate increase within the last week, the Australian Bureau of Statistics has today (30 September) revealed a CPI 0.5 per cent higher YOY in August compared to July.

According to the ABS, inflation has fluctuated significantly over the course of 2026, peaking at 4.6 per cent in March and falling to a low of 3.5 per cent in July.

As surmised by ABS head of price statistics Rachael McCririck, housing was the largest contributor to annual inflation over the last 12 months to August, rising by 5.7 per cent.

She said: “Annual inflation of 5.7 per cent for housing reflected rising costs for both new dwellings and electricity. New dwelling prices rose 5.4 per cent in the 12 months to August as builders passed on higher costs for materials and labour.”

As expected, higher fuel prices saw transport rise by 5.6 per cent, “driven by higher world oil prices and the unwinding of the remainder of the federal government’s fuel excise relief measures in August”, McCririck added.

Further, trimmed mean inflation held steady at 3.6 per cent for the third consecutive month, highlighting an ongoing stubbornness within price increases.

Speaking on the RBA’s decision earlier this week, APAC managing director at Employment Hero James Keene said the increase is likely to add pressure to Australian SMBs that are already navigating slowed hiring momentum.

He said: “Businesses have shown they can weather a tough cycle. But as the RBA seeks to bring inflation under control, further pressure on borrowing costs could make businesses far more cautious about hiring and investment. In turn, job seekers are left facing a less certain market.”

“Governor Michele Bullock’s focus on productivity this week is an important signal for businesses, but the productivity challenge facing Australia isn’t a ‘lack of ambition’ from business owners. It’s that many SMBs are still burdened by manual processes and administrative complexity that distract from growth.”

He added: “If we want more businesses growing to their full potential, accelerating technology adoption across the SMB sector needs to be part of the solution.”

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