Australia's Inflation Climbs to 4.3%, Above Forecast, Before RBA Vote

Australia's annual inflation rate rose to 4.3% in September from 4.0% in August, the Australian Bureau of Statistics said at 11:30 a.m. Sydney time Wednesday (8:30 p.m. ET Tuesday). The consensus forecast was 4.2%, according to FXStreet.

Prices rose 0.8% in the month before seasonal adjustment, against a 0.7% forecast and 0.4% in August, FXStreet's tally of the release shows.

Where the pressure came from

Transport led the climb, up 8.7% from a year earlier and 3.0% in September alone, the ABS said. Housing costs rose 5.2%, driven by a 12.8% jump in electricity prices, while rents rose 3.6%. So the two bills that are hardest to skip, the fuel tank and the power meter, did most of the work.

The trimmed mean, a core gauge that strips out the biggest price swings, rose to 3.6% from a revised 3.5%. That is above the Reserve Bank of Australia's 2% to 3% target band.

The rate picture

The RBA lifted its cash rate target to 4.60% on Sept. 30, its fourth increase this year, the central bank's records show. Its Monetary Policy Board next meets Nov. 2-3. FXStreet said the print added to bets on a November hike, and the Australian dollar rose to about $0.705, its highest since Sept. 23.

Crypto barely moved on the release. Bitcoin traded near $81,020 at midnight ET, up 1.7% in 24 hours, according to CoinGecko. Traders now turn to the U.S. Federal Reserve's two-day meeting, FXStreet noted.

In our opinion: The number that matters is Nov. 3, when the RBA shows whether a hotter September changes its plan. A fifth hike this year would be the clearest sign yet that the RBA expects this inflation to stick around.