What was the headline Australian inflation rate for April 2026?

Australia's headline annual inflation rate eased to 4.2 per cent in the 12 months to April 2026, down from the 4.6 per cent recorded in March. According to the Australian Bureau of Statistics (ABS), seven out of eleven Consumer Price Index (CPI) groups saw a slowdown in annual growth.

Why did Australian underlying inflation rise while headline inflation fell?

While headline inflation dropped, underlying inflation—measured by the trimmed mean—rose to 3.4 per cent in April, up from 3.3 per cent in March.

Which sectors are driving the highest inflation in Australia right now?

Housing led the inflationary surge with a 6.3 per cent annual increase, heavily impacted by a 22.5 per cent spike in electricity costs alongside rising rents and new dwelling construction. Transport costs also remain a major contributor, climbing 6.6 per cent annually despite moderating from a previous peak of 8.9 per cent in March.

Why did Australian electricity costs spike by more than 20 per cent?

Electricity costs jumped 22.5 per cent over the 12 months to April 2026 because State and Commonwealth government energy rebates expired. The removal of these subsidies directly exposed retail consumers to higher baseline utility prices, making housing the highest-weighted contributor to the CPI.

How did the April fuel excise cut affect Australian petrol and diesel prices?

The halving of the fuel excise on 1 April triggered a 7.0 per cent month-on-month drop in overall automotive fuel, pulling regular unleaded down 10 per cent to an average of 206 cents per litre. However, diesel bucked the trend entirely, jumping 14 per cent to 292 cents per litre despite the tax cut.

How is the Middle East conflict impacting Australian supply chains and inflation?

Sustained oil pressures from the Middle East conflict have kept Australian fuel prices 23.5 per cent higher than February levels. These elevated energy costs are filtering directly into corporate supply chains, inflating freight-reliant sectors and driving a steep 12.4 per cent annual increase in postal services.

Economy

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Australian inflation eases to 4.2% in April

Written by Liezl GambePublished May. 27 2026Last Updated May. 27 2026

Australia's annual inflation rate eased to 4.2% in the 12 months to April, down from 4.6% in March, according to the Australian Bureau of Statistics.

Despite the headline deceleration, underlying inflation pressures intensified, with the trimmed mean rising slightly to 3.4%, up from 3.3% the previous month.

ABS head of prices statistics Sue-Ellen Luke noted that while seven of the eleven Consumer Price Index groups experienced a slowdown, structural costs remain high.

Housing led the inflationary charge with a 6.3% annual surge, driven heavily by a 22.5% spike in electricity costs following the expiration of government energy rebates, alongside rising costs for rents and new dwelling construction.

Transport costs also climbed 6.6% annually, though this marked a moderation from March's 8.9% peak.

The easing was largely due to a 7% month-on-month drop in automotive fuel prices, influenced by the halving of the fuel excise on April 1.

Average regular unleaded petrol prices dipped 10% to $2.06 per litre. However, diesel bucked the trend, jumping 14% to $2.92 per litre despite the excise cut.

Ms Luke cautioned that fuel prices remain 23.5% higher than February levels due to the Middle East conflict.

The sustained oil pressures continue to filter into supply chains, inflating freight-reliant sectors and driving a 12.4% annual increase in postal services.