Consumer Price Index (CPI) is the most acceptable indicator of Inflation/Deflation which measures the percentage change in the price of a basket of goods and services consumed by residents.

This ‘basket of good’ covers a wide range of goods and services, arranged in the following eleven groups:

  1. Food and non-alcoholic beverages
  2. Alcohol and tobacco
  3. Clothing and footwear
  4. Housing
  5. Furnishings, household equipment and services
  6. Health
  7. Transport
  8. Communication
  9. Recreation and culture
  10. Education
  11. Insurance and financial services.

The Charts below show how the basket of goods can be use:

 

Data Collection

The frequency of price collection by item varies as necessary to obtain reliable price measures. Prices of some items are volatile (i.e. their prices may vary many times each quarter) and for these items frequent price observations are necessary to obtain a reliable measure of the average price for the quarter. Each month prices are collected at regular intervals for goods such as alcohol, men’s and women’s clothing, project homes, motor vehicles, petrol and holiday travel and accommodation. In the case of transactions data, revenue and quantity data are collected on a weekly basis. For most other items, price volatility is not a problem and prices are collected once a quarter. There are a few items where prices are changed at infrequent intervals, for example education fees where prices are set once a year. In these cases, the frequency of price collection is modified accordingly. To find the CPI points in any year, divide the cost of the market basket in year “x” by the cost of the same market basket in the base year. 

Statistic

  • The Consumer Price Index (CPI) rose 1.8% this quarter.
  • Over the twelve months to the June 2022 quarter, the CPI rose 6.1%.
  • The most significant price rises were New dwelling purchases by owner-occupiers (+5.6%), Automotive fuel (+4.2%) and Furniture (+7.0%).
  • Consumer Price Index CPI in Australia is expected to be 127.48 points by the end of this quarter, according to Trading Economics global macro models and analysts’ expectations.
  • In the long-term, the Australia Consumer Price Index (CPI) is projected to trend around 135.09 points in 2023 and 138.46 points in 2024, according to Trading Economics econometric models.

References

https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release#data-download

https://tradingeconomics.com/australia/consumer-price-index-cpi?embed/forecast#:~:text=In%20the%20long%2Dterm%2C%20the,according%20to%20our%20econometric%20models.