Already a subscriber?A former Reserve Bank of Australia official says the central bank is likely to ignore the federal budget’s “miracle” lower inflation forecast because the government’s policies add to persistent inflation pressures.
Mr Kearns said in a research note that cost-of-living subsidies will reduce “measured” headline inflation, known as the consumer price index.Treasurer Jim Chalmers said the package would reduce inflation by 0.5 of a percentage point to 2.75 per cent for the year to June 2025. “Despite this, through the miracle of timing , rounding and some other noise, the budget forecasts don’t show a bounce-back in inflation.”Advertisement
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