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Australia's Inflation Drops to 2.4%, Rate Cuts Expected

1/29/2025

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Summary

Story summary

Australia's inflation rate fell to 2.4% in December 2024, the lowest since March 2021, prompting expectations for interest rate cuts.
Core inflation decreased to 3.2%, largely due to government rebates lowering electricity prices.
Analysts estimate an 84-90% likelihood of a rate cut, leading major banks to revise their forecasts.
Treasurer Jim Chalmers remains optimistic about inflation progress but warns of potential economic risks.

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Story summary

Australia's inflation rate fell to 2.4% in December 2024, the lowest since March 2021, prompting expectations for interest rate cuts.
Core inflation decreased to 3.2%, largely due to government rebates lowering electricity prices.
Analysts estimate an 84-90% likelihood of a rate cut, leading major banks to revise their forecasts.
Treasurer Jim Chalmers remains optimistic about inflation progress but warns of potential economic risks.