CANBERRA, July 29 (Xinhua) -- Australia's annual rate of inflation fell to 3.8 percent in June, according to official data, defying economists' expectations of a rise.
The Australian Bureau of Statistics (ABS) said that the consumer price index rose by 3.8 percent in the year to June, down from 4.0 percent in May.
Economists were tipping headline inflation to rise slightly to 4.1 percent in June, the Australian Broadcasting Corporation reported.
The Reserve Bank of Australia (RBA), the central bank, forecast in May that CPI growth would hit 4.8 percent in June and that the annual trimmed mean, its preferred measure of underlying inflation, would hit 3.8 percent.
The ABS said that trimmed mean inflation was steady at 3.6 percent in June, matching the May figure.
It said that a 6.8 percent rise in housing costs over the 12 months to June was the biggest driver of CPI growth, followed by a 3.3 percent rise in food and non-alcoholic beverage prices.
Transport inflation moderated, rising by 0.1 percent in the year to June, down from a 3.3 percent annual rise reported in May, as fuel prices fell for a third consecutive month.
"Lower world oil prices as a result of some stabilization in the Middle East in June contributed to fuel prices falling 10.9 percent in the month," Rachael McCririck, ABS head of price statistics, said in a statement.
The federal government's 50 percent cut to the sales tax on fuel remained in place in June, but was phased out at a lower rate in July and will end on Sunday.
RBA Governor Michele Bullock said in a speech on Tuesday that the central bank's Monetary Policy Board, of which she is the chair, is prepared to "act as required" to achieve its inflation target of 2-3 percent, including by raising interest rates further if needed.
The board delivered three rate hikes of 0.25 percentage points each in the first half of 2026 and will hold its next two-day meeting from August 9-10. ■