Better wage growth but inflation to bite for months

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High energy and grocery prices will keep the pressure on household budgets, sparking concerns from the Reserve Bank of a potential price-wage spiral.

. Lowe will face questions at Senate estimates and before the economics committee in Canberra next week.

“The path to achieving a soft landing remains narrow,” the RBA report said. “There are considerable uncertainties surrounding the outlook and so around the level of interest rates needed to achieve the board’s objectives.” Treasurer Jim Chalmers said cost-of-living pressures remained the government’s biggest focus, adding its plan to reduce energy prices was helping take the sting out of inflation in the economy.

“They promised before the election lower electricity prices. They promised before the election cheaper mortgages. None of this has been delivered. These numbers today confirm exactly that,” he said. Betashares chief economist David Bassanese said consumer spending remained fairly resilient over the last year despite the interest rate increases, which had allowed businesses to pass supply-related costs through to buyers.

 

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'Price-wage spiral'? Real wages have remained stagnant - or gone backwards - for the past 10+ years. Meanwhile, corporate profits have more than doubled AFTER inflation. What about the 'profit-price spiral'? Oh, wait...Lowe doesn't care about that. Auspol Ausecon SackLowe

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