Brett Warren , National Director – Metropole Group
If you’ve been keeping an eye on inflation in Australia, you might have noticed that things are finally settling down.
The latest data from the Australian Bureau of Statistics (ABS) reveals that the Consumer Price Index (CPI) rose 0.9% in the March 2025 quarter, bringing annual inflation to 2.4%. Compared to the past few years of economic uncertainty, this is a promising shift towards stability.
One of the biggest wins here is that annual inflation remains unchanged from the previous quarter. After periods of unpredictable price surges, this steadiness suggests that we’re moving into a more predictable economic climate.
Stability is a great sign – it means businesses and households can plan ahead with more confidence, whether it’s setting budgets, making investments, or preparing for future expenses.
Another positive indicator is trimmed mean inflation, which helps filter out large fluctuations in prices to show the underlying trend. It dropped to 2.9%, its lowest level since December 2021, which signals that price pressures are continuing to ease.
If you’ve been feeling the pinch from rising service costs, you’re not alone. But here’s the bright side – services inflation saw its lowest annual rate since June 2022, dropping to 3.7%, down from 4.3% last quarter, according to the ABS. That means things like rent and insurance, which have been major financial stressors for many people, are seeing a welcome slowdown in price increases.
One of the key contributors to quarterly inflation was electricity, rising 16.3%. But before you panic, this was largely due to the Queensland State Government electricity rebate running out. Once rebates adjust and prices stabilise across other states, we could see a more balanced energy cost landscape.
Education costs rose 5.2%, largely due to the new school year kicking off, with primary and secondary education experiencing price hikes. While this isn’t ideal, it’s a predictable pattern that occurs every year rather than an indication of broader inflation concerns.
Food prices increased by 1.2%, primarily driven by seasonal fluctuations in fruit and vegetables. The good news? Seasonal price hikes are temporary, and supply will balance out in the coming months.
Overall, these numbers show that inflation is holding steady, services inflation is easing, and even though some prices have risen, they’re mostly driven by seasonal factors rather than ongoing inflationary pressures. That means we’re heading toward a more predictable economic environment – something we’ve all been hoping for!
So, while costs will always fluctuate, this report offers a reassuring glimpse into a more stable financial landscape.
Plus, with inflation now appearing to be under control, all eyes will be on the Reserve Bank of Australia to unwind more of its restrictive monetary policy settings, which will help the cash flow situations of all existing, as well as prospective, homeowners and investors.
