The Coalition government and Labor must help the Reserve Bank of Australia contain inflation and interest rates by cutting spending or raising taxes to get the federal budget under control as the economy hits full employment, economists have warned.
Deloitte Access Economics partner Chris Richardson said with inflation firming and interest rates poised to rise, the risk was the RBA would have a “foot on the brake” and the government had a “foot on the accelerator”.“We’re throwing the full adjustment burden onto the Reserve Bank,” Mr Richardson said.
for a fifth straight year, a stimulus that would add fuel consumer spending in the middle of this year when the RBA forecasts underlying inflation to hit 3.25 per cent – above the target. “One of the risks to our small open economy with free capital flows, is the global bond market pushes our long-term interest rates much higher, which feeds into all asset valuations including our housing market.“There was also intergenerational fairness issues to consider in incurring more debt for future taxpayers to repay, he said.
That’s more than 1 percentage point lower than pre-pandemic, which Mr Downes estimates should improve the budget balance by at least $20 billion from higher tax revenue and lower welfare spending.
RBA is lost, has been for 6 months or more! Aged sector in crisis, health in crisis, wages must rise prices are making it difficult for people.
the biggest swindle is in neg gearing, capital gains tax discount n franking tax credit They can get $30bils more tax each year
With borders opening won’t the Full employment situation be not such an issue ?
Thats how you do a BURNOUT- Maybe they are just Revheads
Lucky we have a two speed economy
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