Australian inflation has biggest ever quarterly fall dropping 1.9% partly due to free childcare

Australia experienced deflation for the year to June and economists expect the Covid-19 recession will keep prices low

Australia has recorded the largest ever quarterly fall in inflation of 1.9% after the Morrison government temporarily made childcare free due to the coronavirus crisis.

Economists expect the country's Covid-19 recession will result in a prolonged period of low inflation, forcing retailers to cut prices or keep them low and crushing workers' hopes of a pay rise.