Australia private inflation indicator higher at 3.1% y/y in October (prior 3.0%)

Melbourne Institute monthly CPI survey, for October 2025.

3.1% y/y

• prior 3.0%

0.3% m/m

• prior 0.4%

The data suggest price pressures remain sticky, keeping inflation just above the Reserve Bank of Australia’s 2–3% target band.

While the uptick is modest, it reinforces the RBA’s cautious stance on policy easing, with officials likely to seek further confirmation that underlying inflation is sustainably moving back within target before considering additional rate cuts. The result also aligns with recent signals from Governor Michele Bullock that that the path back to target could be gradual amid mixed readings across services and goods inflation.

The Reserve Bank of Australia is meeting today and tomorrow (November 3 and 4). Expectations of a 25bp rate rate hike were ignitied after the jobs data a couple of weeks back:

• Australia’s jobless rate jumps to 4.5%, fuelling RBA rate-cut bets for November

A key caveat were the CPI data that were still to come at the time. Reserve Bank of Australia Governor Bullock said in the lead up to the CPI data that a 0.9% q/q rise in trimmed mean inflation in the quarterly CPI data would be a “material miss” against the RBA’s August forecast of 0.6% q/q. We got that data, and the ‘material miss’, on October 29 that dashed hopes for a cut:

• Australian Q3 Core inflation (trimmed mean) +1.0% q/q (expected 0.8%, RBA forecast 0.6%)

Bullocks comments and the CPI data have acted as tailwinds for the Australian dollar.

This article was written by Eamonn Sheridan at investinglive.com.