GOLD RUSH FOR EXPORTS; JUMP IN INFLATION
Resource commodity exports fall, as gold soars
Iron ore, coal, and natural gas continued to dominate Australia’s exports in 2024-25, contributing almost 40 per cent in the value of goods and services exports. Latest figures released by the Department of Foreign Affairs and Trade, however, show that exports of iron and concentrates fell by 15.5 per cent over the year, to $116.4 billion, and coal, by 22 per cent to $71.3 billion. Rising gold prices pushed gold exports – the fifth-biggest export earner – up by 42 per cent to almost $47 billion. Natural gas exports fell by 5.7 per cent to $64.6 billion, while education-related travel services rose five per cent to $53.5 billion. Australia’s biggest imports in 2024-25 were personal travel, at $65.1 billion, refined petroleum $43.8 billion, and passenger motor vehicles, $34.5 billion.
Inflation bounces ahead in December
Headline annual inflation has jumped, hitting 3.8 per cent in the 12 months to December, up from 3.4 per cent in November, according to the latest Consumer Price Index (CPI). The Australian Bureau of Statistics (ABS) attributed much of the rise to the higher cost of housing and education, while over the 12 months it found that electricity costs had risen by 21.5 per cent. Trimmed mean inflation – which omits volatile price movements - rose slightly, from an annual 3.2 per cent to 3.3 per cent. In June 2025, the CPI recorded headline annual inflation at 1.9 per cent.
Export price rises outpace imports
Meanwhile, the prices of Australian exports rose by 3.2 per cent in the December quarter, outpacing a 0.9 per cent increase in import prices over the same period. ABS international trade price figures attributed the rise in exports to a near 20 per cent lift in gold prices, as investors sought safe-haven assets, and Chinese demand for iron ore and coal. Export prices fell for natural and manufactured gas in the quarter. Demand from the clean energy and agricultural sectors helped to drive a 42 per cent increase in the price of imported crude fertilisers and minerals.
National Cabinet agrees to peg NDIS costs
Federal, State and Territory leaders have agreed to further reforms to the National Disability Insurance Scheme (NDIS), including on a target to restrain annual cost increases in the scheme to under six per cent. National Cabinet agreed to adjust state and territory NDIS contribution escalation rates to a cap of eight per cent, effective from July 2028. Prime Minister Anthony Albanese said $2 billion, matched by states, would be provided to deliver the Thriving Kids program. Under this plan, children with developmental delay or low to mild levels of autism, would be catered for by Thriving Kids. Children with permanent or significant disability would continue to be eligible for the NDIS. Federal Budget papers for 2025-26 forecast that the NDIS would cost $52 billion this fiscal year.
Renewables accounting for 50 per cent of energy, says AEMO
Renewable generation supplied more than half of the national energy market’s needs for the first time during the December 2025 quarter, according to the Australian Energy Market Operator (AEMO). AEMO’s Quarterly Energy Dynamics report showed that wholesale electricity prices averaged around $50 per megawatt hour (MWh), a fall of 44 per cent on the same quarter of 2024. The report said that wind generation rose by 29 per cent and grid scale solar was up 15 per cent in the December quarter, while coal-fired generation fell by 4.6 per cent and gas-fired generation by 27 per cent on the previous year. In the East Coast gas market, AEMO reported a three per cent drop in total demand, driven by lower liquefied natural gas (LNG) export requirements in Queensland and reduced gas-fired generation.
Treasurer targets thin capitalisation rules on debt deduction
Federal Treasurer Jim Chalmers has announced a review of Australia’s reforms on so-called thin capitalisation, which allows multinational companies to use debt deductions to minimise tax. Dr Chalmers said the Board of Taxation would conduct the review, with the reforms designed to ensure multinationals paid a fairer share of tax in Australia. He said that when multinationals exploited loopholes to pay less tax, they gained an unfair advantage over local businesses. Reforms of the thin capitalisation regime would seek to align with the Organisation for Economic Co-operation and Development best practice guidance, the Treasurer said.