Australia's current annual inflation rate is sitting at 6.1%, with the September quarter results to be released in October. 

Here are what some of Australia’s leading financial institutions predict. 

Reserve Bank of Australia

In his September 2022 cash rate hike statement, RBA Governor Dr Phillip Lowe said, “The Bank's central forecast is for CPI inflation to be around 7.75% per cent over 2022, a little above 4% over 2023 and around 3% over 2024.” 

To keep inflation from rising higher than 7.75% and bring it back to the RBA’s target band of 2-3%, the Board has “committed to doing what is necessary to ensure that inflation in Australia returns to target over time.”

This is likely to include further interest rate hikes.

“The Board expects to increase interest rates further over the months ahead, but it is not on a pre-set path,” Dr Lowe said.

That said, in a speech on Thursday, Dr Lowe said the RBA has significantly missed the mark on inflation forecasts this year.

Forecast misses of this scale should lead to soul-searching by forecasters and they certainly have at the RBA. It is important that we learn from this and improve our understanding of the inflation process.

The Federal Government

During an update to economic forecasts before the Federal Parliament in July, Treasurer Jim Chalmers said inflation is tipped to peak at 7.75% in the December quarter of 2022. 

Mr Chalmers suggests inflation will retract to 5.50% by mid-2023, 3.50% by the end of 2023 and reach 2.75% by mid-2024. 

"We haven’t reached the peak yet – but we can see it from here," he said. 

"Inflation will unwind again, but not in an instant.

"Just as the domestic forces contributing to some of the supply side pressures have been building for the best part of a decade, it will take some time for them to dissipate – but they will."

Commonwealth Bank

CommBank’s Head of Australian Economics Gareth Aird said inflation is set to peak at 6.75%, before contracting over 2023. 

A recent report from CommBank noted the annual rate of wage growth is currently at 2.6%, which is well below the 3.5% that the RBA is targeting to be consistent with inflation. 

“The RBA want wages growth up and inflation down – an unusual place for a central bank to find itself,” Mr Aird said.

“Inflation is elevated and the labour market is tight, but the forward looking indicators of the economy are slowing quickly and we expect further weakness in the data over the period ahead.”


ANZ economists believe Australia is past the peak in quarterly inflation, however expects annual inflation to keep rising, peaking at 7.40% by the end of 2022. 

“We think inflation is going to be quite sticky and it won't be until the second half of 2024 that we see underlying inflation get back into the RBA’s target band of 2-3%,” ANZ senior economist Catherine Birch said.

“Wages aren’t a key driver of inflation in Australia so far but demand is, which is a big reason why the RBA is lifting rates so quickly.”


NAB economists predict inflation to peak at around 7.5% by the end of 2022. 

“In the absence of further significant global shocks, we expect inflation to moderate over 2023 but the level of prices is likely to remain elevated," they said.

Furthermore, they are also predicting the cash rate will sit at 2.85% by end 2022 with further increases in 2023 unlikely given their “expectation for slowing growth and moderating inflation.”


Westpac economists revised their previously forecasted inflation peak of 6.6% from June this year to over 7% by year’s end. 

Additionally, Westpac Chief Economist Bill Evans predicts the Board will slow the pace of increases to 25 basis points from the October RBA meeting.

“This second stage of the tightening process, with consecutive 25 basis point increments, is expected to extend out to February next year with the rate peaking at 3.35%,” Mr Evans said.


AMP Senior Economist Diana Mousina forecasts consumer price inflation to peak around 7.5% by December 2022, before decreasing to 5.5% by mid-2023 and 3.5% by late 2023.

“Inflation is unlikely to be headed back to its pre-Covid levels of around 2% per annum or less and we expect it to remain 'sticky' in 2023 - around 3-4% in the US and Australia - which means central banks are not done with rate hikes,” Ms Mousina said.


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