Worst of Australian inflation crisis over: Treasurer

CANBERRA: Australia's Treasurer Jim Chalmers said on Sunday that the worst part of the country's inflation crisis was over.

Ahead of the Australian Bureau of Statistics (ABS) releasing consumer price index (CPI) data for the final quarter of 2022 on Wednesday, Chalmers said he was optimistic that price increases would start to moderate in 2023, Xinhua News Agency reported.

Wednesday's data is expected to reveal another rise in the CPI but both the Treasury and the Reserve Bank of Australia (RBA) have predicted a peak in the December quarter.

Chalmers said the cost of living pressures would continue to affect millions of Australians but stressed that relief would be a key part of May's federal budget.

"The Australian economy will begin to soften a bit this year and that is the inevitable likely consequence of higher interest rates and a slowing global economy," he told reporters.

"That's why our economic plan is cost-of-living relief in a responsible way and growing the economy without adding to these inflationary pressures."

According to the ABS, inflation rose by 7.3 per cent in the 12 months to September, with a 10.9-percent rise in gas and household fuel prices a major contributing factor.

A Treasury analysis released on Saturday found the gas price cap, which was put into place by the government in December 2022, is expected to drive down wholesale prices by between 29 and 44 per cent in the financial year 2023-24.

"Energy is a bigger part of our inflation challenge in our economy," Chalmers said.

"There have been other price pressures which have started to ease whether it's shipping costs or housing costs or some of the others, and that's obviously welcome.