The Australian wage growth slowed in the fourth quarter of 2024, reported the Australian Bureau of Statistics on Wednesday.

The nation's Wage Price Index (WPI) rose by a seasonally 0.7% in the December quarter, and by 3.2% in 2024 over 2023, reported ABS.

The quarterly rise of 0.7% was the slowest since the first quarter of 2022, and the full-year rise was down from a 4.2% gain logged in 2023, added the ABS.

In the fourth quarter, the private-sector annualized wage growth, at 3.3%, was the lowest since the second quarter 2022, while annual wage growth for the public sector, at 2.8%, fell below 3% for the first time since the 2022 second quarter, said the ABS.

The cooling wage picture is likely well-received at the Reserve Bank of Australia (RBA).

Citing easing inflation and easing wages, the RBA cut its key policy rate to 4.10% from 4.35% on Monday.

The RBA has an annual inflation target of 2% to 3% on the nation's consumer price index.

The nation's official inflation rate struck a recent high of 7.8% in the fourth quarter of 2022, as a result of COVID-era restrictions, higher wages, and government fiscal and monetary stimulus.

However, in the fourth quarter of 2024, the nation's inflation rate, as measured by the CPI, fell to 2.4% on year, although the RBA noted that the "underlying" rate of inflation, a type of core index, rose by 3.2% on year in the period.

The RBA noted that wage moderation will play a role in future rate decisions.