Annual inflation in Australia slowed more than expected in June, easing pressure on the Reserve Bank of Australia to hike rates further.
Australia’s annual inflation rate fell to 3.8% in June, down from 4% in May, missing economists’ expectations of a 4% print. The data, released by the Australian Bureau of Statistics, marks the lowest inflation reading since late 2021.
The decline follows a steady easing trend over the past year, with inflation peaking at 7.8% in December 2022. Analysts had anticipated a slower deceleration, citing persistent services inflation and wage growth as key risks.
Markets are now pricing in a lower probability of another Reserve Bank of Australia rate hike in the near term, with bond yields edging lower in early trading.