Australia has posted its lowest inflation since fuel prices surged due to war in the Middle East. (Joanna Kordina/AAP PHOTOS)Australia has posted its lowest inflation since fuel prices surged due to war in the Middle East. The latest Australian Bureau of Statistics data showed headline annual inflation falling to 3.8 per cent in June, down from four per cent a month earlier. "The federal government's fuel excise relief measures, which contributed to lower automatic fuel prices in April and May, also remained in place." "Ongoing conflict in the Middle East remains a threat to inflation, inflation expectations and hence the policy rate outlook."