Details Of Q4 CPI

A quick look at the details of the slightly stronger than expected (although still well shy of 2.0%) inflation metrics reveal that the biggest price surge came from the alcohol and tobacco group. In Q/Q terms, the ABS noted that "a 10.9% rise in tobacco was the main contributor, due to the annual excise tax increase of 12.5% and the bi-annual excise tax increase based on Average Weekly Ordinary Time Earnings (AWOTE) indexation, both applied on 1 September 2020." This provides no surprise.

• The second largest round of Q/Q increases came from the furnishings, household equipment and services group. The ABS noted that "a rise of 37.7% in childcare was the main contributor as out-of-pocket expenses for childcare fees returned to pre-COVID levels. For more information on childcare see Update to measuring the CPI in the December 2020 quarter. Excluding the impact of childcare, this group would have fallen 0.7%." Once again, the jump in childcare costs came as no surprise.