Reserve Bank facing election rate rise after biggest inflation growth in 22 years

The biggest increase in consumer prices since 2000 is expected to force the Reserve Bank into an interest rate rise just days out from the May 21 federal election, bringing the debate over cost-of-living back to the centre of the campaign in its final critical days.

Financial markets now believe the RBA will take the official cash rate, currently at a record low of 0.1 per cent, to 0.25 per cent at next Tuesday’s meeting. The same markets believe home buyers will be hit by consecutive rate rises through the rest of the year with the cash rate tipped to be at 2.5 per cent by year’s end.

But shadow treasurer Jim Chalmers said cost of living pressures had been lifting since well before global events, including the war in Ukraine, put pressure on inflation.“This inflation number should be a wake-up call for a government which is out of touch, out of plans, and out of time,” he said.easily justify a rate hike“A record low cash rate of 0.

Among discretionary items, inflation is running at a much more moderate 2.7 per cent. This included the costs of international travel that plummeted more than 20 per cent in the March quarter alone. But financial markets now believe the bank will have to use its May 3 meeting to deliver the first increase in the official cash rate since November 2010. The last time the bank, which sets interest rates independently of the federal government, moved rates in an election campaign was just weeks out from the 2007 poll.

Michael Blythe, economist at analytics firm PinPoint Macro, said the key reason Governor Phil Lowe had fought against lifting interest rates so far was to reach the goal of full employment, and the board was unlikely to abandon that goal now.

Source: Financial Digest (financialdigest.net)

There's no fkn reason for shops to put it up so high. Just plain greed. Buy local When u can. Markets ect ect. 12 bucks for a mop stick. They pay 5 cents.

Worst Inflation for 22 years Debt - worst Deficit - worst Underemployment - worst Aged care worker shortages - worst Regional foreign policy failure - worst Coalition crumbling Zero effort on Nett Zero Secrets and rorts Another 3 years of this? AusPol2022 VoteThemOut

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