Economy dominates Australian elections

The economy is almost always the main game in Australia's federal elections and will be as central as ever between now and the twenty twenty-eight poll.

Voters misunderstand how rates work

Reserve Bank research from July found only twenty-five percent of respondents could correctly explain that higher interest rates would lead to lower inflation. More than half believed rates would push up costs.

Bullock raises rates to four point six percent

Reserve Bank governor Michele Bullock raised the cash rate to four point six percent on Tuesday, with warnings that more hikes could be coming soon. Talkback callers called her and the board heartless and cruel.

Inflation rises despite steady trimmed mean

Headline inflation rose to four percent in the year to August, up from three point five percent. Trimmed mean inflation held steady at three point six percent for a third month, way above the bank's two to three percent target band.

Labor blames Trump's Iran war

Anthony Albanese and Jim Chalmers blamed Donald Trump's war in Iran and the resulting global fuel shock for the inflation quagmire. Bullock said fuel prices and Middle East disruption were in addition to domestic problems.

Government spending grew faster under Labor

Chalmers says real spending growth has averaged two percent a year under Labor, but excluding the sharp fall in twenty twenty-two to twenty twenty-three, real spending grew four point two percent yearly, compared with two point six percent under the Coalition in the six years before the pandemic.

Productivity remains stubbornly low

Chalmers is throwing everything at fixing sluggish productivity, which Bullock highlighted as doing nothing to help the country's woes. Budget watcher Chris Richardson called the economy completely clapped out and warned the inflation dragon rears its head whenever there is economic sunshine.

“completely clapped out”

Interest payments to overtake Medicare

Treasury forecasts that interest payments will overtake Medicare spending by twenty twenty-eight to twenty twenty-nine, due to one point two trillion dollars in federal debt. Chalmers and finance minister Katy Gallagher must find more savings before the end of the year.

Taylor outlines opposition spending cuts

Angus Taylor nominated Labor's net zero by twenty fifty programs, housing vehicles, corporate welfare and NDIS spending as areas where he would cut to reduce inflationary pressure. He would limit welfare spending while supporting first home buyers only if they are Australian citizens.

Hip-pocket politics becomes Labor's vulnerability

Labor's struggles on inflation, high interest rates and cost-of-living pain look likely to grow. Hip-pocket politics, once again, risk becoming the government's biggest vulnerability ahead of the election.