ANZ-Roy Morgan Inflation Expectations increased to 5.2% in mid-January – up from 4.8% for the month of December
NOTE: RELEASED BEFORE THE MONTHLY ABS FIGURES
The weekly ANZ-Roy Morgan Inflation Expectations were 5.2% for the week of January 13-19, 2025. This figure is above the average for last year of 4.9%, and up 0.4% points from the month of December.
A look at monthly Inflation Expectations for December 2024 shows the measure at 4.8% for the month – up 0.1% points from previous three months of September to November, but below the average for last year of 4.9%.
Looking back over the last year, weekly Inflation Expectations have moved in a narrow band of 4.5% - 5.3% since the start of 2024 and averaged 4.9%. In addition, the latest information on weekly Inflation Expectations is available to view each week in the Roy Morgan Weekly Update video on YouTube.
Monthly Inflation Expectations Index long-term trend – Expected Annual Inflation in next 2 years
Source: Roy Morgan Single Source: Interviewing an average of 4,900 Australians aged 14+ per month (April 2010 – Dec. 2024).
Petrol prices increased by three cents per litre in December to the highest since August 2024
The month of December saw average retail petrol prices increase by three cents per litre to $1.83 per litre. During December, average retail petrol prices increased to a high of $1.89 in late December. However, after the month of December ended average retail petrol prices have subsequently decreased to around $1.82 per litre in late January although weekly inflation expectations have inched higher in January compared to their average for the month of December.
Looking back, average retail petrol prices have now been above $1.70 per litre for a record 123 straight weeks since mid-September 2022 – well over two years. Average retail petrol prices hit a low of $1.73 per litre in late September, again in mid-October and for a third time in late November.
Looking longer-term, average retail petrol prices have now averaged $1.89 per litre since early February 2024, but this has dropped to an average of $1.80 per litre since late September over the last four months.
The persistently high petrol prices are clearly a key factor putting upward pressure on Inflation Expectations, which have increased marginally in December and in the early weeks of 2025, but the overall trend is for lowering inflation. The latest official ABS Quarterly annual CPI estimate at 2.8% for the September quarter 2024, was a decrease of 1% point from the 3.8% recorded for the June quarter 2024.
The official inflation estimate of 2.8% for the 12 months to September quarter 2024 is now within the Reserve Bank’s inflation target of 2-3% over the course of the economic cycle and has led to increasing discussion of when the RBA might commence an interest rate cutting cycle in the next few months.
The next ABS Monthly & Quarterly CPI estimate for December 2024 is due to be released later this week.
Australian average retail petrol prices (cents per litre) weekly: 2021 – 2025
Source: Australian Institute of Petroleum (AIP) weekly reports: https://www.aip.com.au/pricing/weekly-prices-reports.
Inflation Expectations are highest in Tasmania and Queensland – well above 5%
A look at Monthly Inflation Expectations on a State-based level shows Tasmania has the highest Inflation Expectations at 5.7%, up a significant 1.6% points from a month ago – the largest monthly increase of any State.
On the mainland, the highest Inflation Expectations are again in Queensland for a third straight month at 5.2%, up 0.3% points from a month ago. Inflation Expectations also increased in Western Australia, up 0.3% points to 5.0%.
In contrast, Inflation Expectations in the other mainland States declined in December. In Victoria Inflation Expectations were down 0.1% points to 4.7%, were down 0.2% points to 4.6% in New South Wales and were down 0.2% points to 4.5% in South Australia and lower than any other State.
Inflation Expectations in Country Areas were unchanged at 4.9% in December for a third straight month but increased by 0.2% points to 4.8% in Capital Cities.
Roy Morgan CEO Michele Levine says weekly Inflation Expectations were at 5.2% in mid-January, up a significant 0.4% points from the monthly estimate of 4.8% for December, indicating inflationary pressures in the economy remain sticky despite having dropped from earlier last year:
“ANZ-Roy Morgan Inflation Expectations in Australia have increased in January and are now at 5.2%, up 0.4% points from the month of December (4.8%). Inflation Expectations for the month of December were up 0.1% points from their level of the previous three months.
“The increase in Inflation Expectations towards the end of last year tracks with the average retail petrol price which increased late last year after hitting lows of $1.73 in each of late September, mid-October and again in the last week of November.
“Importantly, since reaching that level average retail petrol prices steadily increased in the next few weeks and have been consistently above $1.80 per litre since early December, putting upward pressure on Inflation Expectations and broader inflation. Over the longer-term petrol prices have been above $1.70 per litre for 123 straight weeks since mid-September 2022 – well over two years above this mark.
“Looking forward, the ABS is set to release the December 2024 monthly and quarterly CPI estimates later this week. The estimates will be keenly watched to see if the estimates continue at their low rate. The ABS estimated monthly annual inflation was only 2.3% in the year to November 2024 – near the middle of the Reserve Bank’s preferred target range.
“The latest results from the weekly ANZ-Roy Morgan Inflation Expectations suggest the upward pressures on inflation were muted during November but have increased marginally during more recent weeks of December and January as average retail petrol prices resumed their climb.
“The volatility in energy prices, and Inflation Expectations, shows how sensitive Australians are to changes in the prices of essential everyday goods – like petrol.”
See below for a comprehensive list of RBA interest rate changes during the time-period charted above.
The data for the Inflation Expectations series is drawn from the Roy Morgan Single Source which has interviewed an average of around 5,200 Australians aged 14+ per month over the last decade from January 2015 – December 2024 and includes interviews with 6,019 Australians aged 14+ in November 2024.
For comments and information about Roy Morgan’s Inflation Expectations data, please contact:
Roy Morgan Enquiries
Office: +61 (3) 9224 5309
askroymorgan@roymorgan.com
About Roy Morgan
Roy Morgan is Australia’s largest independent Australian research company, with offices in each state, as well as in the U.S. and U.K. A full-service research organisation, Roy Morgan has over 80 years’ experience collecting objective, independent information on consumers.
The questions used to calculate the Monthly Roy Morgan Inflation Expectations Index.
1) Prices: “During the next 2 years, do you think that prices in general will go up, or go down, or stay where they are now?”
2a) If stay where they are now: “Do you mean that prices will go up at the same rate as now or that prices in general will not go up during the next 2 years?
2b) If go up or go down: “By about what per cent per year do you expect prices to (go up/ go down) on average during the next 2 years?”
3) “Would that be (x%) per year, or is that the total for prices over the next 2 years?”
The Roy Morgan Inflation Expectations Index is a forward-looking indicator unlike the Consumer Price Index (CPI) and is based on continuous (weekly) measurement, and monthly reporting. The Roy Morgan Inflation Expectations Index is current and relevant.
| Monthly Roy Morgan Inflation Expectations Index (2010 – 2024) | |||||||||||||
| Year | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Yearly Average |
| 2010 | n/a | n/a | n/a | 5.9 | 5.8 | 5.5 | 5.6 | 5.4 | 5.5 | 5.8 | 5.6 | 5.8 | 5.7 |
| 2011 | 6.6 | 6.4 | 6.4 | 6.2 | 6.1 | 6.2 | 6.1 | 5.8 | 5.7 | 5.8 | 5.5 | 5.5 | 6.0 |
| 2012 | 5.4 | 5.5 | 5.9 | 5.9 | 6.0 | 6.2 | 5.9 | 5.9 | 5.8 | 5.7 | 5.6 | 5.4 | 5.8 |
| 2013 | 5.2 | 5.1 | 5.3 | 4.9 | 5.2 | 4.9 | 5.3 | 5.0 | 4.8 | 4.9 | 4.8 | 5.0 | 5.0 |
| 2014 | 5.1 | 5.2 | 5.2 | 5.1 | 5.1 | 5.3 | 5.0 | 4.8 | 5.0 | 4.8 | 4.9 | 4.4 | 5.0 |
| 2015 | 4.4 | 4.3 | 4.5 | 4.5 | 4.2 | 4.4 | 4.4 | 4.5 | 4.5 | 4.2 | 4.4 | 4.5 | 4.5 |
| 2016 | 4.3 | 4.2 | 4.2 | 4.2 | 4.0 | 4.0 | 4.1 | 3.9 | 4.1 | 4.1 | 3.9 | 4.2 | 4.1 |
| 2017 | 4.5 | 4.4 | 4.4 | 4.4 | 4.3 | 4.2 | 4.3 | 4.5 | 4.4 | 4.5 | 4.5 | 4.5 | 4.4 |
| 2018 | 4.5 | 4.4 | 4.3 | 4.5 | 4.3 | 4.5 | 4.3 | 4.3 | 4.3 | 4.5 | 4.3 | 4.2 | 4.4 |
| 2019 | 4.2 | 4.0 | 4.0 | 3.7 | 4.1 | 3.8 | 4.1 | 3.9 | 4.0 | 4.1 | 3.9 | 4.0 | 4.0 |
| 2020 | 3.9 | 4.0 | 4.0 | 3.6 | 3.3 | 3.2 | 3.4 | 3.2 | 3.3 | 3.5 | 3.4 | 3.6 | 3.5 |
| 2021 | 3.6 | 3.7 | 3.8 | 3.7 | 3.7 | 4.0 | 4.1 | 4.3 | 4.5 | 4.8 | 4.9 | 4.8 | 4.2 |
| 2022 | 4.9 | 5.1 | 5.8 | 5.5 | 5.3 | 5.7 | 5.9 | 5.6 | 5.4 | 5.6 | 6.5 | 6.0 | 5.6 |
| 2023 | 5.3 | 5.3 | 5.6 | 5.3 | 5.2 | 5.6 | 5.6 | 5.4 | 5.2 | 5.3 | 5.4 | 5.3 | 5.4 |
| 2024 | 5.1 | 5.0 | 4.9 | 5.2 | 4.9 | 4.9 | 5.1 | 5.0 | 4.7 | 4.7 | 4.7 | 4.8 | 4.9 |
| Monthly Average | 4.8 | 4.8 | 4.9 | 4.8 | 4.8 | 4.8 | 4.9 | 4.8 | 4.7 | 4.8 | 4.8 | 4.8 | 4.8 |
| Overall: Roy Morgan Inflation Expectations Average: 4.8 | |||||||||||||
The Roy Morgan Consumer Confidence Report – Including Inflation Expectations
To learn more about the trends for Inflation Expectations as well as Consumer Confidence for different segments and demographics throughout the Australian community, purchase the Roy Morgan Consumer Confidence Monthly Report.
Margin of Error
The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.
| Sample Size | Percentage Estimate |
| 40% – 60% | 25% or 75% | 10% or 90% | 5% or 95% | |
| 1,000 | ±3.0 | ±2.7 | ±1.9 | ±1.3 |
| 5,000 | ±1.4 | ±1.2 | ±0.8 | ±0.6 |
| 7,500 | ±1.1 | ±1.0 | ±0.7 | ±0.5 |
| 10,000 | ±1.0 | ±0.9 | ±0.6 | ±0.4 |
| 20,000 | ±0.7 | ±0.6 | ±0.4 | ±0.3 |
| 50,000 | ±0.4 | ±0.4 | ±0.3 | ±0.2 |
