Business & Economy

Australian CPI records worst-ever quarterly fall due to COVID-19

Sydney, Australia, Jul 29 (efe-epa).- Australia’s Consumer Price Index (CPI) fell by 1.9 percent in the second quarter, its worst-ever quarterly decline, on account of the ongoing COVID-19 pandemic, the Australian Bureau of Statistics (ABS) announced on Wednesday.

The decline in the indicator in the latest quarter caused annual prices to fall by 0.3 percent in June, the ABS said in a statement.

“Since 1949, this was only the third time annual inflation has been negative. The previous times were in 1962 and 1997-98,” said Bruce Hockman, chief economist for the ABS, adding that “this was the largest quarterly fall in the 72 year history of the CPI.”

The CPI fall was mainly due to free childcare (-95 percent), a significant drop in the price of automotive fuel (-19.3 percent) and a decline in primary and pre-school education (-16.2 percent).

“Excluding these three components, the CPI would have risen 0.1 per cent in the June quarter,” Hockman said.

Some components of the CPI increased notably, such as cleaning and maintenance products (6.2 percent), other non-durable household products, including toilet paper (4.5 percent), furniture (3.8 percent) and major household appliances (3 percent), among others.

Deflation requires a widespread and prolonged drop in the price levels of goods and services for at least two semesters.

The gross domestic product (GDP) of Australia fell 0.3 percent in the first quarter of the year and the country is expected to enter technical recession when the upcoming second-quarter results reflect the full impact of the pandemic.

Australia, which successfully handled the first wave of coronavirus infections in the country, has recorded more than 15,500 cases since the beginning of the epidemic – more than half of them detected during the ongoing second wave – including 176 deaths. EFE-EPA


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