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Inflation Calculator

Calculate the impact of inflation on purchasing power using historical Australian CPI data from the ABS.

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Disclaimer

This calculator provides estimates for general information purposes only. Results are based on standard formulas and may not reflect your individual circumstances. Always consult a qualified professional for advice specific to your situation.

Frequently Asked Questions

What has been Australia's average inflation rate?
Australia's average annual inflation rate over the past 25 years (2000-2025) has been approximately 2.8%. The RBA targets inflation of 2-3% over the medium term. Notable outliers include 2022 (7.8% — post-COVID/Ukraine war supply shocks) and 2020 (0.9% — COVID demand collapse).
How does inflation affect purchasing power?
Inflation reduces the value of money over time. At 3% annual inflation, $100 today buys only $74 worth of goods in 10 years and $55 in 20 years. This is why investments need to earn returns above the inflation rate to grow in real terms. The CPI (Consumer Price Index) measures inflation using a basket of goods and services tracked by the ABS.

What is Inflation?

Inflation measures the increase in prices over time, reducing the purchasing power of money. Australia's inflation is measured by the Consumer Price Index (CPI), published quarterly by the ABS.

How this calculator works

This calculator uses official ABS CPI data from 2000 to 2025 to show how the value of money has changed. It applies each year's actual inflation rate sequentially to calculate the cumulative effect. The year-by-year table shows each annual rate and the running value, with high-inflation years (like 2022's 7.8%) highlighted. The purchasing power figure tells you what percentage of buying power a dollar has lost over your chosen period.

All calculations are performed in your browser — your data never leaves your device. Results are for general guidance only and should not be considered professional financial advice.

Built and maintained by Konstantin Iakovlev. Data sourced from the ATO and official Australian government sources.