CPI eased in November

Trimmed mean annual inflation was 3.2 per cent in the 12 months leading up to November 2025, down from 3.3 per cent in the 12 months to October 2025.

Underlying inflation, also known as the trimmed mean, is one of the key figures that the Reserve Bank of Australia (RBA) considers when setting the cash rate because it strips out the most volatile price movements in the reference period.

Overall, the consumer price index (CPI) rose 3.4 per cent in the 12 months to November 2025, also down from a 3.8 per cent rise in the 12 months to October 2025.

The main factors contributing to the annual inflation rate were housing, which rose 5.2 per cent; food and non-alcoholic beverages, which increased 3.3 per cent; and transport, up 2.7 per cent.

While these figures represent a marginal reduction in the inflation rate, they remain above the Reserve Bank of Australia’s (RBA) target range of 2–3 per cent.

This CPI announcement marks the second posting since the ABS's transition from a quarterly CPI to a complete monthly CPI as the primary measure of headline inflation.

Michelle Marquardt, ABS head of prices statistics said that this allows the data to be compared more effectively and enables more insights into phenomena, such in this case, the Black Friday Sales.

Marquardt said: "Having a monthly CPI means we can more clearly see temporary events such as Black Friday sales and compare them across time. In November 2024 and 2025, several goods categories had price falls including clothing, footwear and furniture.

"As the price falls this year were similar to last year, the Black Friday sales were not a major contributor to the change in annual CPI inflation from October to November."

Federal Treasurer Jim Chalmers MP called the inflation results "very welcome and very encouraging."

Inflation remained, however, "much higher than we would like," he added.

"While we’ve made good progress on the economy together, we recognise the job is far from over because people are still under pressure."

The RBA’s next move

This latest inflation data comes ahead of the RBA’s first monetary policy announcement of 2026, scheduled for 3 February.

The current cash rate sits at 3.6 per cent, where it has remained since it was cut from 3.85 per cent in July 2025.

Recently released minutes from the RBA’s December meeting outlined the decision-making process behind the latest rate hold, as well as what it would take to trigger a rate hike. Board members stopped short of acting in December, stating that it was too early to draw firm conclusions about inflation trends.

However, they did note that underlying inflation is projected to remain above the 2–3 per cent target until 2027, and should inflationary trends persist, “an increase in the cash rate might need to be considered at some point in the coming year.”

These latest CPI figures provide some early guidance on the direction of that decision, although the central bank said it will place more weight on the December-quarter inflation data, released on 28 January.

[Related: Major banks split over interest rate direction]