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.

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

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.

CPI grew 2.4% year-on-year in Q4, its slowest pace since early 2021, data from the Australian Bureau of Statistics showed on Wednesday. The reading was just below expectations of 2.5% and eased from the 2.8% seen in the prior quarter. CPI grew 0.2% quarter-on-quarter, slightly less than expectations of 0.3%.

Inflation has eased to its lowest reading since early 2021 after falling more than expected in the December quarter, improving market confidence that the Reserve Bank could move as soon as next month to offer households mortgage relief.