An electronic display shows the price of 91-octane petrol at a petrol station in Canberra, Australia, Aug. 26, 2026. The Australian Bureau of Statistics (ABS) said on Wednesday that the Australian consumer price index (CPI) rose by 3.5 percent in the 12 months to July, down from 3.8 percent in June and the lowest annual figure since November 2025. (Photos: Xinhua)

CANBERRA, Aug. 26 (Xinhua) -- The Australian Bureau of Statistics (ABS) said on Wednesday that the Australian consumer price index (CPI) rose by 3.5 percent in the 12 months to July, down from 3.8 percent in June and the lowest annual figure since November 2025.

Despite the fall in headline inflation, the ABS noted that the annual trimmed mean, the measure of underlying inflation preferred by the Reserve Bank of Australia (RBA), remained steady at 3.6 percent in July.

Economists from the Commonwealth Bank of Australia had forecast that CPI growth would fall to 3.2 percent in July and the trimmed mean would ease to 3.5 percent.

The ABS said that housing prices were the biggest driver of headline inflation in the 12 months to July, rising by 5.0 percent, followed by a 3.2 percent rise in food and non-alcoholic beverage prices.

Rachael McCririck, head of price statistics at the ABS, said that new dwelling prices rose by 5.7 percent in the year to July as builders passed on higher costs for materials and labor.

She said that automotive fuel prices were 7.5 percent higher in July than in June due to higher global oil prices and the federal government winding down fuel tax relief measures.

The latest forecasts from the RBA projected that annual trimmed mean inflation would drop to 3.3 percent in December before falling within the central bank's 2-3 percent target range in 2027.

People shop for fruit at a supermarket in Canberra, Australia, on Aug. 26, 2026. The Australian Bureau of Statistics (ABS) said on Wednesday that the Australian consumer price index (CPI) rose by 3.5 percent in the 12 months to July, down from 3.8 percent in June and the lowest annual figure since November 2025.

A woman shops for food at a supermarket in Canberra, Australia, on Aug. 26, 2026. The Australian Bureau of Statistics (ABS) said on Wednesday that the Australian consumer price index (CPI) rose by 3.5 percent in the 12 months to July, down from 3.8 percent in June and the lowest annual figure since November 2025.