New figures show inflation has slowed to a two-year low of 4.3% leading many to speculate there will be no need for further interest rate rises.
Australian Bureau of Statistics figures for November, show inflation is down from 4.9% in October. This is down from a peak of 8.4% in December 2022.
The Reserve Bank of Australia due to meet again in February and many analysts are predicting there will be no need for it to increase interest rates at that meeting following the better than expected inflation figures.
The latest data means prices are rising at their slowest rate since January 2022. The November inflation figure was lower than many economists were tipping, with most believing it would be about 4.5%.
The RBA board kept the official cash rate steady at 4.35% in its final December meeting, although Governor Michele Bullock has not ruled out further increases this year if deemed necessary.
"Whether further tightening of monetary policy is required to ensure that inflation returns to target in a reasonable timeframe will depend upon the data and the evolving assessment of risks," she says.
Bullock says they are keeping a close eye on what is happening in the global economy and trends in domestic demand as well as wages growth.
New data shows wages rose by 4% in the year to September 2023 which is the fastest rate of growth since 2009.