Inflation eases, fruit and veg goes up

There are signs inflation pressures are easing, giving scope for the Reserve Bank to cut interest rates.

The bureau of statistics reported today that the consumer price index lifted by 0.5 per cent in the September quarter. At an annual rate it fell to 2.3 per cent.

The closely watched underlying measures of inflation also fell back to sit at 2.5 per cent at the annual level.

Fruit prices were the single largest bug bear for shoppers through the quarter, with prices up by 14.7 per cent nationally.

Over the past year, fruit prices have climbed by 19.2 per cent. Vegetable prices have lifted by 10 per cent over the same period.

Purchases by owner-occupier of houses rose by 1.1 per cent while property rates and charges jumped by 6.3 per cent.

The removal of the carbon tax contributed to a 5.1 per cent fall in electricity prices through the quarter while the global drop in oil prices contributed to a 2.5 per cent fall in automotive fuel costs.

Clothing and footwear prices dropped by one per cent in the quarter to be 2.7 per cent lower over the full year.

There were also falls in the prices of communications (by 1.4 per cent) and in health (0.1 per cent). Over the full year, health costs are still up by 4.7 per cent.

Prices in Perth lifted by 0.5 per cent in the quarter with annual inflation still above the national rate at 2.6 per cent.