Inflation in Australia remained in retreat in the final quarter of 2024, stoking the case for the central bank to join the global easing cycle by cutting rates at its coming meeting in February.

Politics is not a good reason for the Reserve Bank to cut interest rates, unless the economic arguments are strong. Right now, they are not.

Australian consumer prices rose at the slowest pace in almost four years in the December quarter, while a pullback in housing costs helped cool core inflation and open the door to a cut in interest rates as early as next month.

Australias consumer price index (CPI) inflation grew less than expected in the fourth quarter, signaling a slowdown but still remaining above the Reserve Bank of Australias (RBA) target range. Data from the