Advertisement

Scorching inflation hits Brisbane, ‘a decade’s wage growth wiped out’

Brisbane’s inflation was the equal worst in the country at 2.1 per cent in the June quarter, well above the national figure of 1.8 per cent, according to the Australian Bureau of Statistics.

Jul 27, 2022, updated Jul 27, 2022
Housing approvals have plunged and economists fear for the economy

Housing approvals have plunged and economists fear for the economy

On an annual basis, inflation in the city was 7.3 per cent, just behind Perth’s 7.4 per cent as the worst. Sydney was 5.3 per cent and Melbourne 6.1 per cent while Adelaide and Darwin were level with Brisbane.

And housing was a key factor with the cost of buying a new home up 20 per cent in a year, nationwide.

ANZ’s David Plank said it appeared that Australia was “moving past the peak in quarterly inflation, but it’s a high peak to come down from.

“This doesn’t change our view on the RBA’s near-term meetings, where we expect 50 basis point hikes,” he said.
Adding to the belief that inflation may have peaked, the increases in non-discretionary items slowed from 3 per cent in March to 1.8 per cent in June. Utility prices also declined.
AMP Capital’s Shane Oliver said Australians could expect some slowing in goods price inflation, but services inflation would be key.

The most significant contributors to the rise in the June quarter CPI were new dwellings (+5.6 per cent) and automotive fuel (+4.2 per cent).

“Shortages of building supplies and labour, high freight costs and ongoing high levels of construction activity continued to contribute to price rises for newly built dwellings. Fewer grant payments made this quarter from the Federal Government’s HomeBuilder program and similar state-based housing construction programs also contributed to the rise,” the ABS said.

“The CPI’s automotive fuel series reached a record level for the fourth consecutive quarter. Fuel prices rose strongly over May and June, following a fall in April due to the fuel excise cut.”

Unions also pointed out that the high inflation nationally means the working population had lost an entire decade of wage growth, which was adding to the cost of living.

Federal Treasurer Jim Chalmers said a real wage increase that would keep up with inflation was not credible, but would improve over the current term of parliament.

But while many expected the CPI figure to be higher, it was still expected to add to pressure on the Reserve Bank to lift its benchmark cash rate, which would lead to high bank interest rates. It was also the highest annual increase since the introduction of the GST.

Clothing and footwear, housing, groceries, and fuel prices were big contributors to the consumer price index. Notably, fuel prices have been falling this month but the food industry expects inflation to stay high over the rest of the year.

Business Council chief executive Jennifer Westacott said the Australia’s only option to manage rising costs of living was to build resilience “by taking control of every lever we can”.

“We can’t control inflation driven by events on the other side of the world, but we can manage the bottlenecks and blockages that make the problem worse,” she said.

“Previous changes to child care have helped ease the pressure on some fronts but there is no doubt Australians are hurting.

“Unnecessary friction in the economy is adding to costs and making it harder and more costly for Australians to get things done.  We’ve got to shift gears to focus on the little things, because taken together they will help ease the pressure on Australian families.

“Every product that can’t get to shelves because there aren’t enough truck drivers or new homes that takes longer to approve because of unnecessary red tape is making this challenge worse. Every layer of complexity that slows down our ability import or export goods and services, get them through ports or move them around the country adds to household bills.

“We have to act now to manage labour shortages and supply chain blockages that are pushing up prices and punishing Australians. In the short term that will mean acting to fill the chronic workforce shortages.”

 

InQueensland in your inbox. The best local news every workday at lunch time.
By signing up, you agree to our User Agreement andPrivacy Policy & Cookie Statement. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

 

 

Today Queensland families will once again be reworking their household budgets in the face of yet more cost of living pressures.

 

Queensland inflation has risen to 7.3%, the second highest in the nation, well above the national inflation rate of 6.1%.

 

Queenslanders are feeling cost of living pressures more than most.

 

They feel it when they buy groceries, fill up the car, pay their bills or just head out to dinner.

 

Queenslanders are crying out for the Palaszczuk Government to help ease these pressures, yet the Palaszczuk Government is refusing to listen.

 

We need a government that understands the realities Queensland families are facing.

Local News Matters
Advertisement

We strive to deliver the best local independent coverage of the issues that matter to Queenslanders.

Copyright © 2024 InQueensland.
All rights reserved.
Privacy Policy