What is the current inflation rate in Australia?

Australia's annual CPI inflation was approximately 3.5% in 2024, down from 5.5% in 2023 and a peak of 6.6% in 2022. The RBA targets inflation of 2-3% over the medium term. For 2025 and 2026, inflation is estimated at 2.8% and 2.5% respectively as it returns to the target band.

How does inflation affect purchasing power?

Inflation erodes purchasing power — meaning the same amount of money buys fewer goods and services over time. For example, $100 in 2015 has the same purchasing power as approximately $130 in 2025. If your wages haven't grown by at least the CPI rate each year, you're effectively taking a pay cut in real terms.

CPI (Consumer Price Index) measures the average change in prices paid by Australian households for a basket of goods and services including food, housing, transport, and recreation. The ABS (Australian Bureau of Statistics) publishes CPI data quarterly. It is the most commonly used measure of inflation in Australia and is used to adjust tax brackets, government payments, and superannuation caps.

Inflation Calculator

See how inflation changes the value of your money over time. Use historical Australian CPI data to compare purchasing power between years, or project how much you'll need in the future to maintain today's lifestyle.

Last verified: 1 July 2025

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General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.

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