Higher costs are increasingly weighing on Australians, with the country's latest economic figures reflecting significant gaps with consumer prices abroad, amid latest efforts by Australian authorities to address the rising cost of living, including healthcare and housing.
The monthly consumer price index indicator rose 2.5 percent in the 12 months to January, according to latest Australian Bureau of Statistics (ABS) figures, with the top contributors being food and non-alcoholic beverages, housing, and alcohol and tobacco. Partly offsetting the annual rise was a fall for electricity, according to the ABS.
Rental prices alone rose 5.8 percent in the 12 months to January, following a 6.2 percent rise to December, said the bureau.
Analysts had forecast the CPI rate to increase to 2.6 percent for January, which would mark the third consecutive monthly rise, according to financial services firm CMC Markets in Sydney.
"Australia's inflation rate has fallen sharply since peaking in December 2022. However, after bottoming out at nearly 2.2 percent year-on-year in September and October, the past few months have seen Australia's CPI rise to around 2.5 percent year-on-year," it said in a weekly outlook.
Michele Bullock, the governor of the Reserve Bank of Australia, the country's central bank, told federal Members of Parliament on Feb 21 that the "impact of high inflation over the past couple of years has permanently increased the price level".
"That has hurt everyone but particularly those on lower incomes and the more vulnerable," Australia's ABC News quoted her as saying.
The cost of living including rent in Sydney alone is about 102 percent higher than that in Beijing, according to global cost-of-living database Numbeo, with grocery prices in the major Australian city 112.2 percent more than those in the Chinese capital.
Earlier this month, Australia's Treasurer Jim Chalmers said that financial authorities' decision to lower the cash rate by 25 basis points to 4.10 percent was "very welcome news for millions of Australians".
"This is the rate relief Australians need and deserve," he said in a statement.
"It won't solve every problem in our economy or in household budgets but it will help," Chalmers said.
"For a household with a mortgage of A$500,000 ($317,000), this rate cut will save them A$80 a month, or A$960 per year … The Government will maintain a primary focus on the cost of living."
Meanwhile, in a joint media release on Feb 23, Australia's Prime Minister Anthony Albanese and its Health Minister Mark Butler took on healthcare cost issues ahead of a federal election, which must be held by May 17, saying that a "re-elected Albanese Labor Government will make the single largest investment" in the country's Medicare healthcare system since its establishment over 40 years ago.
"Australian patients and families will save hundreds of dollars a year in out-of-pocket costs, with patient savings of A$859 million a year by 2030," according to the release.
"No Australian should have to check their bank balance to see if they can afford to see a doctor," Albanese said.
The move "will make Medicare even stronger, help with cost of living pressures and ensure every Australian receives the best health care that they deserve", he said.
The Australian government is also tackling housing woes amid rising costs, such as a two-year ban on purchases of existing homes by foreign investors starting April 1.
The move is aimed at easing housing supply pressures and ensuring that local residents have better access to affordable dwellings.
Latest industry reports point to a recent decline in new investment in residential properties – with ABS figures showing the number of investment loans for dwellings falling 4.5 percent between the September and December quarters (2024) – in turn sparking concerns for housing availability.
The latest housing policy is part of a broader strategy that includes tax incentives for developers and a shared equity scheme, with the goal of constructing 1.2 million new homes by the end of the decade.
The government has also rolled out policies to further increase housing supply, including training more construction workers to build houses, improving planning, zoning and land releases, and encouraging older Australians to downsize to help younger Australian families with housing.
Agencies contributed to this story.
