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Steady CPI points to stable interest rates

29 Jan 14

The December 2013 quarter Consumer Price Index (CPI) figures show that the Reserve Bank of Australia’s (RBA) consumer price measures of inflation continue to be stable and are well within their target zone.

Real Estate Institute of Australia (REIA) President, Mr Peter Bushby, says the RBA should maintain the current level of interest rates.

"In the December quarter, the consumer price index rose by 0.8% and annual inflation rate is now 2.7%. These figures are well within the RBA’s target zone of 2-3%," Mr Bushby said.

The analytical series of trimmed mean and weighted median both increased by 0.9% for the December quarter 2013.

"The annual changes for the trimmed mean and for the weighted median were 2.6% for both and compare to the changes for the twelve months to the September quarter 2013 of 2.3% and 2.4% respectively," Mr Bushby said.

The housing group increased by 0.5% for the December quarter compared to 2.0% in the September 2013 quarter, making the annual rate of increase 4.3%.

The main increases in the December quarter for the housing group was the purchase of new dwellings which increased by 1.0%. For the year to December 2013, the largest increases in the housing group were for water and sewerage (9.3%), property rates and charges (7.9%) and electricity (6.3%). Rents increased by 3.0% for the year.

"With inflation well under control and a subdued economy, it’s appropriate that the RBA Board maintains interest rates at their present level when it meets in February for the first time this year," Mr Bushby concluded.