New analysis released by the Treasury today shows prices in several categories have dropped significantly over the past 12 months, including electricity (down 15.8 per cent), fuel (6.2 per cent), and games and hobbies (5.3 per cent).

“New numbers we have released today show that progress on inflation has been made in areas like electricity, petrol, furniture, toys and textiles,” Treasurer Jim Chalmers said.

“This is a substantial, sustained progress that Australia has made when it comes to the fight against inflation.

“Australia has got inflation down and wages up, (and) unemployment low.”

The figures – and comments – come two days out from official quarterly inflation data from the Australian Bureau of Statistics that will have a significant bearing on whether the Reserve Bank moves to cut interest rates in February.

September quarter headline inflation was at 2.8 per cent – back in the RBA’s target range and at its lowest level since March 2021 – but the “trimmed mean” or core inflation was still relatively high at 3.5 per cent.

ANZ economists believe that measure will drop to 3.2 per cent for the December quarter, which would be the slowest rate of core inflation in three years.

Chalmers did not say whether promising figures should lead the RBA to cut interest rates.

“I don’t engage in commentary about what the Reserve Bank does independently,” he told reporters.

“But look around the world: in the US, inflation is high and rising more than it is in Australia.

“We have been able to make this progress on inflation without seeing the kind of spike in unemployment that other countries have had to endure.

“And if you look around the world, the UK has had a recession, New Zealand’s had a recession, there is higher unemployment in Canada, the US, New Zealand, Europe, the UK and elsewhere.”

Australian investors are currently pricing in a 78 per cent chance of a rate cut on February 18.