New inflation reporting has the Reserve Bank excited

WHAT HAS CHANGED:

* The ABS previously only produced an economy-wide index of consumer price once a quarter

* In 2022, the bureau introduced a monthly indicator of inflation but this only covered about two-thirds of the CPI basket, meaning it was less reliable for the RBA

* After the federal government injected $156.7 million into the ABS to update its IT systems and collect more frequent data, the bureau was able to finally move to a complete monthly measure

WHY IS IT IMPORTANT:

* The RBA described the introduction of the monthly CPI as a "significant milestone", bringing Australia into line with international best practice

* The central bank mainly relies on the quarterly trimmed mean, which excludes volatile items, to make its interest rate decisions, but will transition to the monthly indicator as it becomes more reliable

* The government also relies on the CPI to adjust a number of pensions and allowances, while businesses rely on the index to determine wages and prices

* Assistant Minister for Productivity, Competition, Charities and Treasury, Andrew Leigh, said "having timely price data means better decisions by policymakers and businesses"

WHAT DID THE RELEASE SHOW:

* The CPI rose 3.8 per cent in the 12 months to October 2025, the highest level since the ABS began tracking the series in April 2025

* The annual trimmed mean was 3.3 per cent

* The largest contributor to annual inflation was the housing category, up 5.9 per cent, with electricity costs up 37.1 per cent in 12 months and rents up 4.2 per cent

* Food and non-alcoholic beverages and Recreation and culture were the next highest, both up 3.2 per cent

* Meals out and takeaway climbed 3.6 per cent over the year, driven by rises in labour and ingredient costs

* Holiday travel and accommodation prices rose three per cent annually, driven by a 5.9 per cent monthly rise in domestic travel due to school holidays falling in October

Australian Associated Press