FX.co ★ Australia Q1 Producer Price Inflation Beats Estimates

In the first quarter of 2025, Australia's Producer Price Index (PPI) for final demand increased by 0.9% quarter-on-quarter, slightly surpassing market predictions of 0.8%. This uptick follows the 0.8% rise in the final quarter of 2024, which had been the smallest quarterly growth since the second quarter of 2023. This period marked the 19th consecutive quarter of inflation in producer prices, primarily driven by key sectors. Notably, the property sector saw a 1.1% increase, fueled by robust demand and rising residential rent levels. In addition, prices within the other transport equipment manufacturing sector surged by 7.3%, a trend attributed to the depreciation of the Australian dollar and escalating labor costs. Tertiary education prices also rose by 3.5%, a reflection of inflation-driven fee adjustments, despite more subdued wage growth compared to 2024. Annually, producer prices went up by 3.7%, maintaining the same pace as the previous quarter, though it remains the slowest annual rise observed over the past three years.