Finally, the combination of the above has meant that the RBA board has had the very real possibility of a sharp global downturn doing some of the heavy lifting on slowing the domestic economy in 2023.
To be sure, a mild disinflation, consistent with “peak” headline inflation, is coming out of the global economy. The original “pandemic inflation shock” is now receding. But this will do little to slow an economy now producing 5 per cent to 6 per cent domestic inflation. These are the key factors that motivated the RBA’s pivot to 25bp hikes in October, well before other central banks began to lift their feet off the brakes.
The RBA still has a long way to go on this metric. Our short-term real interest rate was -3.8 per cent in December. Even if core inflation pulls back to 5 per cent as it has done in the US, we are still sitting on a negative real rate of almost 2 per cent.
No kidding!!! Duh!!
And confirm once again the RBA completely asleep at the wheel dealing with soaring prices. Will they get serious or still prefer mortgage holders over the vast majority of Australians?
Lifting rates aint working and never was going to work, product is so expensive coz there just aint enough of it, release the shackles and taxes on manufacturing and increase production, then prices will ease.
But but Australia is special and the government will step in to help....! LOL
Check Albo s personal wealth come June 30!
Because RBAInfo have been reluctant to raise the rates higher due to their fear of bullying from media, politicians and property lobby
RBA get an F for their effort to tame the inflation they and their government caused. It’s almost as if the RBA doesn’t really want to raise its funds rate. I wonder why? Could it be that Australia, and Sydney in particular, have possibly the largest property bubble in history?
Don't tell TheKouk
The last three years experience in australia on many fronts has been „we are exceptional and everything is fine, it’s everywhere else that’s bad“, only for us to glide into the same scenario on 6-12 month lag.
No suprise. It's the definition of monetary inflation (the increase of money supply). Lifting interest rates is a mere band aid. And it's not over yet.
We are getting gouged, so many inputs are below pre covid yet we are told they are passing cost on. Shipping container rates, smashed. Lumber, smashed.
No increase in wages however
I remember being called a 'conspiracy theorist' when i said this was going to happen when they put half the planet in lockdown in 2020.
So when is the gold back dollar coming in ?
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Source: FinancialReview - 🏆 2. / 90 Read more »
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