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Consumer Price Index - September quarter 2001



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24/10/2001 No. 85

Press Release

EMBARGO

Consumer Price Index - September quarter 2001

The release of the Consumer Price Index (CPI) indicates that inflationary pressures continue to remain modest. The All Groups CPI increased by 0.3 per cent in the September quarter 2001, significantly lower than the 0.8 per cent increase observed in the June quarter.

With the one-off change in the price level of the September quarter 2000 associated with the introduction of The New Tax System dropping out of the calculation, the increase in the CPI through the year to the September quarter 2001 was 2.5 per cent - the midpoint of the medium-term inflation target band.

The annual rate of inflation has dropped from 6.0 per cent to 2.5 per cent.

Petrol prices declined significantly in the September quarter, falling by 8.3 per cent. Excluding this effect, the CPI rose only modestly in the September quarter - by around 0.6 per cent - and by 2.8 per cent through the year.

Price increases occurred across various items in the quarter, including fruit prices (up 6.3 per cent, as a result of some supply shortages), meat prices (up 3.0 per cent, reflecting continued very strong world demand for Australian produce), electricity prices (up 3.0 per cent, largely driven by the end of the Victorian Winter Power Bonus) and insurance premiums (up 2.7 per cent due to increases in categories such as motor vehicles and house and contents).

In addition to petrol, price declines were recorded across a range of goods and services in the September quarter. The price of vegetables fell by 8.3 per cent, childcare prices fell by 6.4 per cent, and pharmaceuticals declined by 3.6 per cent. Price declines were also observed for numerous other items in the quarter including clothing and footwear, household furniture and major household appliances, and audio visual and computing equipment.

Canberra

24 October 2001