Australia Annual Inflation Rises to 4.3% in September Ahead of Central Bank Decision

Australia's annual consumer-price inflation accelerated to 4.3% in September 2026 from 4.0% in August, according to figures released on Wednesday, October 28. The increase has strengthened expectations that the Reserve Bank of Australia could raise interest rates again when its board meets on November 3, although no decision has yet been made.

The Australian Bureau of Statistics scheduled its September consumer price index release for 11:30 a.m. Australian eastern daylight time on October 28. The latest data show that the central bank's preferred measure of underlying inflation, which excludes extreme price movements, remained at an annual 3.6%. That is above the Reserve Bank's 2%–3% target range and its 2.5% midpoint.

Housing costs increased 5.2% over the preceding 12 months, while transport prices rose 8.7% and food prices increased 3.2%, according to the reported September figures. Housing was the largest contributor to annual inflation, followed by transport. Higher fuel prices have added pressure to transport costs, while construction expenses and electricity prices have contributed to housing-related inflation.

The Reserve Bank raised its cash-rate target to 4.60% in September, its fourth increase of 2026. The latest reading does not automatically trigger another increase. Policymakers will weigh price pressures against weaker economic activity and labour-market conditions before the November meeting.

Deputy Governor Andrew Hauser described the inflation figures as too high during parliamentary estimates on Wednesday and warned that a sustained increase in longer-term inflation expectations would make price growth harder to contain. That warning concerns a potential risk, not a finding that long-term expectations have already become entrenched.

Inflation of 4.3% means the overall consumer-price index was 4.3% higher than in September 2025; it does not mean prices rose 4.3% in September alone. Similarly, a 3.6% underlying rate is an annual measure rather than the central bank's next interest-rate decision.

The result leaves Australian households facing a difficult combination of higher prices and elevated borrowing costs. Economists increasingly expect another quarter-percentage-point rate rise, but the Reserve Bank retains discretion and will announce its decision after the November 3 policy meeting.