After several quarters of steady price increases across key food categories, August 2025 brought a moment of relief for Australian consumers, particularly those shopping for fresh produce. New ABS monthly CPI data, visualised by Episode3, show a sharp decline of 2.9 percent in the fruit and vegetable indicator between July and August. This represents the most significant single-month fall in this category so far this year and follows several months of elevated quarterly inflation.
However, not all categories experienced the same easing. Dairy and meat and seafood both recorded price increases of 1.1 percent month-on-month, a noticeable lift compared to the more subdued movements earlier in the year. These are essential staples in the Australian diet and their price movements are closely linked to broader input costs, supply availability and weather-related disruption. Alcohol prices increased modestly by 0.2 percent over the month, while bread and cereal products saw minimal change, rising by just 0.1 percent.
Although the August data offer some short-term relief, the broader annual figures show that food inflation remains persistent across most categories. Over the year from August 2024 to August 2025, the fruit and vegetable category still rose five percent in total, suggesting that the recent monthly drop may be more seasonal than structural. Alcohol prices increased by 4.7 percent over the same period, maintaining a consistent upward trajectory. Meat and seafood prices rose 2.7 percent, while bread and cereal increased 1.8 percent. Dairy, which had remained relatively flat for much of the year, recorded a small annual gain of 0.4 percent, but the recent monthly movement suggests a potential change in trend.
Price resilience in dairy and protein categories reflects deeper structural pressures, including elevated input costs, labour shortages in processing, and limited stock availability. For meat in particular, prices may be responding to tighter slaughter volumes and delays in the seasonal spring flush, which is expected to occur later than usual this year.
From a policy and budgeting perspective, the August CPI results highlight the importance of tracking inflation at a more granular level. Relying solely on the headline rate masks the divergent experiences across food categories, particularly for consumers on tight budgets. Although there are signs of moderation in overall inflation, the persistence of price pressures in essential goods suggests that cost-of-living remains a key issue for Australian families as they head into spring.
