Australia's Q1 Inflation Rises to Highest Level in Over Two Years, Raising Prospects of Further RBA Rate Hikes

Thu, 30 Apr 2026 16:54:00 +0200

Australia's consumer price inflation climbed to 4.09% year-over-year in the first quarter of 2026, marking the highest level since the fourth quarter of 2023. Although this figure came in below economists' expectations of 4.2%, it still signals persistent price pressures that could prompt the Reserve Bank of Australia (RBA) to consider additional interest rate increases. Quarterly prices rose 1.4% from the previous period. In March, the monthly inflation rate reached 4.6%, the highest since Australia started releasing monthly CPI data in 2025, driven primarily by increases in housing, transport, and food costs. The data arrives just ahead of the RBA's upcoming policy meeting. The central bank had already raised its cash rate to 4.1% in March, the highest level since April 2025. RBA officials have expressed concern that inflation will remain above the bank's 2%-3% target for an extended period. Governor Michelle Bullock noted that board members agree rates may need to rise further, thou