Large price movements in response to the impacts of COVID-19 in the June 2020 quarter have resulted in the largest fall to date in the living cost index (LCI) for Employee households. The fall was driven by the provision of free child care for Australian families during the quarter, with Employee households having the highest weight for both child care and preschool and primary education (which contains a before and after-school care component) of all the LCIs, as shown in table 1.

Other government transfer recipient households also recorded their weakest ever movement, with the second highest weight for childcare and preschool and primary education. In comparison, Aged pensioners and Self-funded retirees have zero weight for child care and only a small weight for preschool and primary education.

Significant price falls for automotive fuel also contributed to the weak movements seen this quarter in all four LCIs.