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Inflation Remains Steady in January 2024

Inflation Remains Steady in January 2024 melbourne mortgage

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According to the latest report from the Australian Bureau of Statistics, the monthly measure of inflation remained steady in January, recording a 3.4 per cent increase. However, the report also shows encouraging signs that a key measure of price pressures is starting to ease.

While housing, food, and insurance services continue to experience price increases, there were falls in other areas such as holiday travel, recreation, and culture. Specifically, the monthly inflation for food and non-alcoholic beverages increased to 4.4 per cent from 4 per cent in December, largely due to higher-priced fruit and vegetables.

Food, fuel and construction prices fall

Interestingly, while there were increases in some food items, grocery prices experienced a decline. The cost of meat and seafood fell by 2 per cent over the past year, while the growth rate for dairy and bread products slowed down.
In addition, prices for clothing, which saw a decrease of 0.4 per cent in the year to December, increased by 1.9 per cent in January. Meanwhile, rents remained steady at a high 7.4 per cent, while insurance was stable at 8.2 per cent.
Moreover, the report indicates that health, petrol, and housing construction costs have eased during the quarter. The Reserve Bank tracks a key measure of inflation, called underlying or core inflation, which excludes one-off or volatile price jumps. The bureau’s trimmed mean inflation rate decreased in January to 3.8 per cent, down 0.2 percentage points from December.
The head of price statistics at the bureau, Michelle Marquardt, noted that the inflation indicators were easing and that the annual inflation for the monthly CPI indicator remained steady at 3.4 per cent, marking the lowest annual inflation since November 2021.

Will interest rates begin to fall?

Mortgage Broker What If We Finance believes this is good news for home loan interest rates as inflation is a key driver impacting interest rates and ultimately home loan affordability.
The downward trends in the inflation figures means sooner rather than late interest rates will fall.

Mortgage Broker Melbourne, What If We Finance has been helping customers secure unbeatable home loan deals since 2008. We are Melbourne’s best mortgage broker. Contact us today to find out more.

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