Inflation in Australia remained in retreat in the final quarter of 2024, stoking the case for the central bank to join the global easing cycle by cutting rates at its coming meeting in February.

Politics is not a good reason for the Reserve Bank to cut interest rates, unless the economic arguments are strong. Right now, they are not.

Australian consumer prices rose at the slowest pace in almost four years in the December quarter, while a pullback in housing costs helped cool core inflation and open the door to a cut in interest rates as early as next month.

Australia’s core inflation eased by more than expected in the final three months of 2024, opening the door to an interest-rate cut as soon as next month and sending the currency lower.