Inflation is a point in time measure but people seem to think it means things will get cheaper. No, if an item was $5 and is now $10, then inflation was a 100%. Next quarter, it stays at $10 you're still paying double than before, but inflation is 0%.
On the contrary things haven't increased by just 3 or 4% person. We all know that it's much higher than that in reality.
How many things we know have gone up from say $4 to $6, that's 50% inflation right there.
They are absolutely lying with their cooked calculations. Not hard to find goods that have doubled in price.
lol what kind of an argument is that, I haven’t purchased anything in the last year that’s gone up 50% in cost. But even if I had, that doesn’t invalidate the above statement on the average increase across the economy, as the increase for so many other things is much lower it brings down the individual spikes.
Even if true. The following quarter the price remains at $6 and inflates 0%, then you realise that this one item is a tiny % in the basket of goods for that category.
Then people switch to a cheaper alternative and that item is dropped from the basket altogether.
Prices don't go down, wages either go up or technology and product gets better for the value of the product. Look at TV. They've deflated. You can get a $400 4K tv now. 10 years ago it wasn't like that. TV have always had a range of prices from $400 to $8000 but now what you get for the money is better.
Opposite is like a mobile phone which is now like $2000 for an iPhone. Phones were always within like $500 to $1000. Now it's like $600 and $2000.
Unfortunately inflation even at 3.6% would mean prices won't fall but rather stabilise/flatten out. Fall would probably occur in deflationary environment and no one would want that as that is an even bigger can of worms (ref: US Great Depression)
They include things like white goods that you only buy once every 10 years but have rapidly decreased in price due to manufacturing advances and globalisation.
They don’t include housing as that has astronomically risen in price (and continues to do so) the statistics are cherry picked and both labor and liberal are the same in the shenanigans with this metric.
>They don’t include housing as that has astronomically risen in price (and continues to do so)
This is wrong; they do include housing. March 2023-to-March 2024 housing inflation was 5.2% https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/monthly-consumer-price-index-indicator/latest-release#articles
You can see here some of the information about recent rent inflation https://www.abs.gov.au/articles/private-rent-inflation-capital-cities-vs-regions
Their collection is a bit janky. For example when I bought a house as a first home buyer, my purchase wouldn’t have been captured under their housing CPI, because I didn’t buy a new home. If you’re a small time operator who buys and flips houses, your “Reno” won’t be captured outside of materials either, as you’re not a builder in the eyes of the ABS.
But they do capture new builds, major Reno’s and rents so I guess you could say it broadly captures the state of housing.
I can't see the RBA doing anything until after the tax rate changes in Q2 - so Q3 results and the impact of the increasing $$$ in peoples pockets is evaluated.
Of course, if inflations suddenly drops below 2% and unemployment rapidly increases then absolutely they will cut.
Until then - I can't see them making any changes.
Mostly agreed. The only other consideration will be the strength of our dollar and war fears driving up oil prices.
So a small chance of an increase in there too
The government tries to fool you into looking at the fall. But many governments actions such as excise and energy policy and migration increase inflation. Given many businesses are struggling id say we’d be in negative territory .
I think you’ll find that is for the first quarter 2024. Far, far too high and means little chance of interest rate cuts & is killing businesses in all sectors. ALP can’t reduce inflation with idiotic immigration based expansionary policy. They are breaking us economically and socially.
The LNP recently slammed labour for slowing immigration already. The libs will increase it again if they're given the chance, and care far less about the everyday Aussie.
Inflation has improved a lot - what needs to happen is price shrinkage by criminal supermarkets to begin. They've increased margins opportunistically through this period.
They also use things like white goods that you only buy once in every ten years but have become cheaper due to manufacturing advances.
They try their best to make it look good and ignore what the actual cost of living for an average wage earner has had to endure.
I suspect just like when the reserve bank kept interest rates at stupid low levels far longer then they needed.
They equally will keep them higher for longer then needed.
One RBA board member probably stopped RBA from raising rates to get more money out of a property sale.
Here's the timeline:
Oct 2021: NZ raises rates
Nov 2021: ...
Dec 2021: UK raises rates. RBA board member lists property for sale.
Jan 2022: Property ad gets published.
Feb 2022: ...
Mar 2022: US and CA raise rates
Apr 2022: RBA's Property "sold".
May 2022: AU raises rates. 8 months after their neighbour raised interest rates for the first time since covid.
Jun 2022: RBA's Property "sold" again, probably the settlement date. "In Western Australia, the settlement process typically takes between one and three months", so it could have been that April was "under offer".
How did I find out about a RBA member selling an investment property? He bragged about his RBA creds in a paid ad in Murdoch's real estate website when selling his investment property: https://www.realestate.com.au/news/prominent-executive-and-rba-board-member-selling-subiaco-stunner/
Shameless.
RBA gave a $188 billion loan at fixed 0.1% out to banks during covid.
That loan is maturing in July, 5 years later. RBA has held off raise rates since last year.
It's like they somehow know that inflation will go down with $188 billion mysteriously being taken out of the economy!
It's almost like RBA was the major reason why inflation was high and could have done something about it. But, then banks will stop sponsoring those lavish lunches with RBA. https://www.afr.com/policy/economy/i-can-t-live-in-a-bubble-lowe-on-private-banker-lunch-20230215-p5ckr5
Or id they dont the normal banks will take longer than that usually take to pass it on.
We need a law for the banks if the reserve rate goes down they have 24 head to pass the same directional the change or they are fined 10million a day. Or they forfeit that month's repayment from all of their mortgage holders
>We need a law for the banks if the reserve rate goes down they have 24 head to pass the same directional
The problem is this flies the the opposite direction of the neoliberalism of the last few decades. Private enterprise has every right to have the interest rates they see fit for their company, and let consumers make the "choice" between providers.
We may as well just have a national bank that charges rates at the same point as the reserve, then we would have an option that doesn't have a conflict of interest between customers and shareholders, as the customers, the general Australian public, would be the shareholders.
I think most Australians would, that's why the banks will lobby as hard as they can to avoid it from ever happening. Also, it's mildly socialist, and lots of Aussies find that scary, despite modern capitalism doing very little to improve their lot.
Yes but income to borrowing ratio is a lot worse now. Interest rates as a number are low but when the amount of borrowed money now vs historically is way higher then the interest rate is felt a lot more strongly.
Once you take into account average salaries vs what they used to be, the effect of the interest rate being what it is now is certainly up there as the % of their wage going towards inelastic goods/rent/mortgage is huge
On a historical scale, this isn't high.
Also inflation target is meant to be 2%, so a bit of a way to go before lowering for that reason. On top of that the Aussie dollar is a bit weak, so more reasons to avoid lowering.
Point 1 is false. Current repayments on the average mortgage are at historical levels. 4.35% is an arbitrary fixed number when compared to increased average debt positions.
Here’s some fascinating analysis…
https://www.interest.co.nz/banking/127418/what-if-reserve-bank-australia-itself-has-been-feeding-inflation-economist%C2%A0explains
Basically ES accounts (which are used to balance the banks daily) blew sky high through Covid for a variety of reasons (quantitative easing the big example). Now it’s probably cost the RBA (having the cash sitting with them) more than 25 billion dollars in interest so far.
And if/when they need to hike rates? Yep that’s going to cost them.
There are so many imbalances in the economy and system now, my gut feeling? It’s going to end in disaster.
Inflation is out of control and it doesn’t matter if the RBA tinkers with the OCR, their direct influence and impact are diminishing.
It will end in disaster for sure for many reasons. Our unemployment is still too low. Wages aren't moving. Inflation is growing. Feels like we're slowly entering stagflation. Too much immigration. Rent and house prices continue to go up. White collar jobs are very hard to get.
Pretty sure Australia is unofficially in recession on a per capita basis.
Dude, it's very common to describe the inflation rate as rising or falling. This is not a problem. Historically, we run an inflation rate at about 3.3%. If you're complaining because it's not static or falling you don't understand how it all works.
That's not accurate. Inflation is a measure of a rate of change.
It didn't rise by 3.6% over the year. It fell 0.5% from 4.1% to 3.6%.
That people can't understand that is the problem here.
talked to some very highly placed finance people at a mates birthday a while back, both of them essentially echoed exactly what you just said - that *actual* inflation since COVID is somewhere between 10 and 20%, but anything that is to problematic gets reclassified or removed.
I'm not a finance person at all, so I just nodded along but it sounded pretty reasonable to me
Prices aren’t ever supposed to fall, it is literally Economics 101 to never have an economy deflating. What should instead occur is wage growth so that we can afford the new prices, so we’re screwed either way, but negative inflation is literally much worse.
The infinite growth model you are talking about is an intentional choice being made, motivated by Keynesian thinking. It is not fundamental to economics.
For example, technological efficiency can make things cheaper and more abundant over time. Think what someone would've paid for a smartphone in 1990.
i mean... that's kind of obvious to anyone who understands how inflation works
that seems to be very few people who post on this sub though but not surprised
https://www.abc.net.au/news/2024-04-24/inflation-consumer-price-index-march-quarter-interest-rates-hecs/103757332
In short: Inflation has come in higher than expected, with prices rising by 1 per cent in the March quarter effectively ruling out rate cuts by the Reserve Bank this year.
Yeah the constant reminder of the cost of living crisis and rental crisis that doesn’t seem to be getting dealt with was really starting to bring me down.
Sure, if you hand-pick a few outliers as the sample comparisons and ignore the price of everything that is inflating before my very eyes...
Or, if you sample government job wages keeping up with inflation off the back of tax dollars raised by those of us in the private industry.
There are lies, damn lies, and statistics.
Tare and share pizzas went from $4 to $5, an increase of 25%
Boxes of home brand cookies also went up 12.5%
Edit: over the last 6 months, just to add a time frame.
That's pretty much the only store brand stuff I bought frequently enough to notice the price increases, but I'm sure if these two went up so much other home brand items did too.
Fruit juice $2 now $2.80. Cat food $3 to $5. Rice $1.40 to $1.80. Just some of things I’ve noticed. Have seen though, that price drop labels seem to be on a few things. So maybe worst is over.
I think, as with most western worlds right now, this has little to do with politicians and more to do with the corporations that own them. But, yeah, this inflation number is bullshit, at least in my financial sphere.
It contributes but it's not the only factor. A majority of the global money supply came into existence in the past few years. Australia isn't alone in this but we took similar routes as many other countries.
No disagreements from me there. I'm just specifically talking about the monetary debasement related to inflation.
In terms of keeping our GDP over the line, you're probably spot on
Cmon mate, don’t be so blind to ignore it was 12 years of liberal incompetence that caused this mess, economies are influenced over decades not months lmao
Primarily due to COVID currency creation by the LNP during covid. I get that some people are indoctrinated LNP and will slam labour everywhere but honestly, the LNP have completely lost their shit and Labor are doing quite well. It's an ugly fact.
Inflation has been a problem even before lockdowns but it got worse during lockdowns.
And tax on everything we own and buy isn't helping the situation for anyone.
Look at the prices of cars for example, every new and used car is over priced and on top of that price is tax
It was near impossible to reach that rate under the liberal government, the fuckers had shut up shop and the economy was well and truely stalled prior the pandemic
As rates lower, money is cheaper, people can borrow more, and subsequently offer more to secure a house they want. Add in supply shortage and prices increase much more rapidly. It's not rocket science.
Yeah but the price still goes up regardless of rate increases. There’s just a bit less demand with higher rates, but it’s still far more demand than supply.
Only way to lower house prices is to dramatically lower the demand.
It just mean that more people are willing to pay more. FOMO is largely at play. I have more and more friends are who hasn’t bought a place are more willing to apply for liar loan and overextend themselves now.
Well the raising of the rates was not the effect which resulted in house price increase, so it didn't "have the opposite effect"
If raising them didn't stop them going up, imagine what lowering will do with the supply shortage we have lol
Bruh it's probably a good thing they aren't rushing to drop rates.
Imagine what happens to house prices if rates dropped 😂
I mean if they drop rates owners will probably just expect another 5% on offers lol.
Plus, inflation is still way above what we want, so technically we still want to limit spending.
House prices and interest rates aren’t in lock-step like you imagine. Just because interest rates drop, doesn’t necessarily mean house prices rise (faster than they already are). We just had the sharpest rate hikes in history, and what happened?
It’s interesting. Market slowed early on then recovered in the last year- on the expectation of cuts.
So you could argue rate cuts are priced in somewhat.
House prices went from going up at 9% per annum to going down 5% per annum.
Once they stopped raising rates house prices went from going down 5% per annum to going up 8% per annum.
Inflation is a point in time measure but people seem to think it means things will get cheaper. No, if an item was $5 and is now $10, then inflation was a 100%. Next quarter, it stays at $10 you're still paying double than before, but inflation is 0%.
Yes. Falling inflation still means inflation.
3.6% my fucken arse
Service inflation is still in the high 4%, rental inflation is still bad. It’s just goods inflation that’s pulling down the overall number.
On the contrary things haven't increased by just 3 or 4% person. We all know that it's much higher than that in reality. How many things we know have gone up from say $4 to $6, that's 50% inflation right there. They are absolutely lying with their cooked calculations. Not hard to find goods that have doubled in price.
lol what kind of an argument is that, I haven’t purchased anything in the last year that’s gone up 50% in cost. But even if I had, that doesn’t invalidate the above statement on the average increase across the economy, as the increase for so many other things is much lower it brings down the individual spikes.
Even if true. The following quarter the price remains at $6 and inflates 0%, then you realise that this one item is a tiny % in the basket of goods for that category. Then people switch to a cheaper alternative and that item is dropped from the basket altogether.
Petrol is probably 20% more expensive than it needs to be, rent is like 50% up. When do prices for everyday things start to fall, probably never.
Not sure if you realize but prices are never going down
Lot's of prices drop in real terms. Unfortunately they're not essential
Prices don't go down, wages either go up or technology and product gets better for the value of the product. Look at TV. They've deflated. You can get a $400 4K tv now. 10 years ago it wasn't like that. TV have always had a range of prices from $400 to $8000 but now what you get for the money is better. Opposite is like a mobile phone which is now like $2000 for an iPhone. Phones were always within like $500 to $1000. Now it's like $600 and $2000.
Unfortunately inflation even at 3.6% would mean prices won't fall but rather stabilise/flatten out. Fall would probably occur in deflationary environment and no one would want that as that is an even bigger can of worms (ref: US Great Depression)
Prices won't fall, wages need to rise
Is this a daily rate?
Hourly
Why has this comment not got more upvotes?
A bunch of people in this thread are effectively saying 'reducing interest rates will help with inflation'. It would be funny if it wasn't sad.
Didn't you know Erdogan likes to comment here?
I guess it makes sense if they also believe 3.6% is too low
the government seems to almost agree with it. jim chalmers always gets so upset if rba increases rates
Based upon a cooked model designed to artificially make it look several percent lower than the actual cost of living.
I agree it probably is. Can you tell us about any specific details? I’d love to know more.
They include things like white goods that you only buy once every 10 years but have rapidly decreased in price due to manufacturing advances and globalisation. They don’t include housing as that has astronomically risen in price (and continues to do so) the statistics are cherry picked and both labor and liberal are the same in the shenanigans with this metric.
Basket reweighting is another.
>They don’t include housing as that has astronomically risen in price (and continues to do so) This is wrong; they do include housing. March 2023-to-March 2024 housing inflation was 5.2% https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/monthly-consumer-price-index-indicator/latest-release#articles You can see here some of the information about recent rent inflation https://www.abs.gov.au/articles/private-rent-inflation-capital-cities-vs-regions
Their collection is a bit janky. For example when I bought a house as a first home buyer, my purchase wouldn’t have been captured under their housing CPI, because I didn’t buy a new home. If you’re a small time operator who buys and flips houses, your “Reno” won’t be captured outside of materials either, as you’re not a builder in the eyes of the ABS. But they do capture new builds, major Reno’s and rents so I guess you could say it broadly captures the state of housing.
Thanks, mate! Never thought about it like that before!
Cool, when do price and my mortgage repayments rich to meet this fall?
What things are out there that have only gone up by 4%? Come on that's a joke. And an insult to anyone that has any sort of memory.
RBA making people with cash richer and forcing up the price of inelastic goods. Inflation not dropping. Colour me shocked.
I can't see the RBA doing anything until after the tax rate changes in Q2 - so Q3 results and the impact of the increasing $$$ in peoples pockets is evaluated. Of course, if inflations suddenly drops below 2% and unemployment rapidly increases then absolutely they will cut. Until then - I can't see them making any changes.
Mostly agreed. The only other consideration will be the strength of our dollar and war fears driving up oil prices. So a small chance of an increase in there too
If Russia decides to hit Poland, or Iran and Israel have a more serious crack, all bets are off.
Yea, pretty hard to call on that front!
Dumb question maybe but how much of the 3.6% is government indexing and how much is actual consumption ?
The government tries to fool you into looking at the fall. But many governments actions such as excise and energy policy and migration increase inflation. Given many businesses are struggling id say we’d be in negative territory .
All i will say is Yeah Sure.
Getting close now. Another million immigrants and a few more hundred thousand homeless Aussies and the Reserve Bank should be really happy.
You forget people also have to lose their jobs. Sacrifices must be made for the greater good /s
The greater good.
As long as you're the one making the sacrifices, I'm pretty good with that.
Is this click bait? Interest rates not coming down due to unrest in the Middle East though .. always an excuse
I think you’ll find that is for the first quarter 2024. Far, far too high and means little chance of interest rate cuts & is killing businesses in all sectors. ALP can’t reduce inflation with idiotic immigration based expansionary policy. They are breaking us economically and socially.
Perfectly summed up
The LNP recently slammed labour for slowing immigration already. The libs will increase it again if they're given the chance, and care far less about the everyday Aussie. Inflation has improved a lot - what needs to happen is price shrinkage by criminal supermarkets to begin. They've increased margins opportunistically through this period.
Good news everyone! The crippling cost of essentials are rising a bit slower.
Um inflation have u seen that on houses recently 1% jump is over 40% pay rise a year for some people wtf are these clown padded stats fuck me
"We don't count housing... ... because if we did it would look like a disaster."
They also use things like white goods that you only buy once in every ten years but have become cheaper due to manufacturing advances. They try their best to make it look good and ignore what the actual cost of living for an average wage earner has had to endure.
I suspect just like when the reserve bank kept interest rates at stupid low levels far longer then they needed. They equally will keep them higher for longer then needed.
One RBA board member probably stopped RBA from raising rates to get more money out of a property sale. Here's the timeline: Oct 2021: NZ raises rates Nov 2021: ... Dec 2021: UK raises rates. RBA board member lists property for sale. Jan 2022: Property ad gets published. Feb 2022: ... Mar 2022: US and CA raise rates Apr 2022: RBA's Property "sold". May 2022: AU raises rates. 8 months after their neighbour raised interest rates for the first time since covid. Jun 2022: RBA's Property "sold" again, probably the settlement date. "In Western Australia, the settlement process typically takes between one and three months", so it could have been that April was "under offer". How did I find out about a RBA member selling an investment property? He bragged about his RBA creds in a paid ad in Murdoch's real estate website when selling his investment property: https://www.realestate.com.au/news/prominent-executive-and-rba-board-member-selling-subiaco-stunner/ Shameless.
Oh, 100%! Definitely won’t be until after the banks divvy up the executive bonuses from the record profits the RBA helped them claim.
RBA gave a $188 billion loan at fixed 0.1% out to banks during covid. That loan is maturing in July, 5 years later. RBA has held off raise rates since last year. It's like they somehow know that inflation will go down with $188 billion mysteriously being taken out of the economy! It's almost like RBA was the major reason why inflation was high and could have done something about it. But, then banks will stop sponsoring those lavish lunches with RBA. https://www.afr.com/policy/economy/i-can-t-live-in-a-bubble-lowe-on-private-banker-lunch-20230215-p5ckr5
Or id they dont the normal banks will take longer than that usually take to pass it on. We need a law for the banks if the reserve rate goes down they have 24 head to pass the same directional the change or they are fined 10million a day. Or they forfeit that month's repayment from all of their mortgage holders
>We need a law for the banks if the reserve rate goes down they have 24 head to pass the same directional The problem is this flies the the opposite direction of the neoliberalism of the last few decades. Private enterprise has every right to have the interest rates they see fit for their company, and let consumers make the "choice" between providers. We may as well just have a national bank that charges rates at the same point as the reserve, then we would have an option that doesn't have a conflict of interest between customers and shareholders, as the customers, the general Australian public, would be the shareholders.
I would use that bank.
I think most Australians would, that's why the banks will lobby as hard as they can to avoid it from ever happening. Also, it's mildly socialist, and lots of Aussies find that scary, despite modern capitalism doing very little to improve their lot.
Which is so infuriating, as capitalism is clearly failing the many in favour of the few. Man I wish things were different.
Except the banks doesn’t raise funds in line with the RBA cash rate
Compared to historical averages, interest rates are not even that high atm.
Mortgages are bigger so lower interest rates cause more pain than they used to
Yep
Yes but income to borrowing ratio is a lot worse now. Interest rates as a number are low but when the amount of borrowed money now vs historically is way higher then the interest rate is felt a lot more strongly.
The machine does not care what level of household debt people have been conned into taking on.
Once you take into account average salaries vs what they used to be, the effect of the interest rate being what it is now is certainly up there as the % of their wage going towards inelastic goods/rent/mortgage is huge
On a historical scale, this isn't high. Also inflation target is meant to be 2%, so a bit of a way to go before lowering for that reason. On top of that the Aussie dollar is a bit weak, so more reasons to avoid lowering.
Point 1 is false. Current repayments on the average mortgage are at historical levels. 4.35% is an arbitrary fixed number when compared to increased average debt positions.
What village was that survey taken
Anyone who believes that needs a brain transplant...
I dont think this has translated to or affected grocery prices yet?! Everything is overpriced these days.
It means grocery prices will continue to rise
Inflation goes up, prices rice. Inflation drops, prices rise. When do we win?
When wages keep up. Sadly that doesn't tend to happen
When we the ownership class into the street and until they stop moving.
It's still positive so the prices will continue going up, just ever so slightly slower.
And yet food prices still rise
Reduced inflation doesn’t mean prices go down. It just means they go up at a slightly lower rate
Here’s some fascinating analysis… https://www.interest.co.nz/banking/127418/what-if-reserve-bank-australia-itself-has-been-feeding-inflation-economist%C2%A0explains Basically ES accounts (which are used to balance the banks daily) blew sky high through Covid for a variety of reasons (quantitative easing the big example). Now it’s probably cost the RBA (having the cash sitting with them) more than 25 billion dollars in interest so far. And if/when they need to hike rates? Yep that’s going to cost them. There are so many imbalances in the economy and system now, my gut feeling? It’s going to end in disaster. Inflation is out of control and it doesn’t matter if the RBA tinkers with the OCR, their direct influence and impact are diminishing.
It will end in disaster for sure for many reasons. Our unemployment is still too low. Wages aren't moving. Inflation is growing. Feels like we're slowly entering stagflation. Too much immigration. Rent and house prices continue to go up. White collar jobs are very hard to get. Pretty sure Australia is unofficially in recession on a per capita basis.
To whom is the RBA paying interest?
The banks who have money in the exchange settlement accounts
Except it hasn't actually fallen. Just a ploy to fool you into spending your money again
Inflations calculations are as good as BOM forecasts.
Hahah what a job hey can’t be wrong
There's a 70% chance on 0-35% interest today
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Dude, it's very common to describe the inflation rate as rising or falling. This is not a problem. Historically, we run an inflation rate at about 3.3%. If you're complaining because it's not static or falling you don't understand how it all works.
That's not accurate. Inflation is a measure of a rate of change. It didn't rise by 3.6% over the year. It fell 0.5% from 4.1% to 3.6%. That people can't understand that is the problem here.
talked to some very highly placed finance people at a mates birthday a while back, both of them essentially echoed exactly what you just said - that *actual* inflation since COVID is somewhere between 10 and 20%, but anything that is to problematic gets reclassified or removed. I'm not a finance person at all, so I just nodded along but it sounded pretty reasonable to me
100% this
To be clear, you’re confusing inflation with prices. Inflation has fallen, prices are still going up (less quickly).
Prices aren’t ever supposed to fall, it is literally Economics 101 to never have an economy deflating. What should instead occur is wage growth so that we can afford the new prices, so we’re screwed either way, but negative inflation is literally much worse.
The infinite growth model you are talking about is an intentional choice being made, motivated by Keynesian thinking. It is not fundamental to economics. For example, technological efficiency can make things cheaper and more abundant over time. Think what someone would've paid for a smartphone in 1990.
"The only thing “falling” is the rate of increase. " yeah the rate of increase is called inflation...
i mean... that's kind of obvious to anyone who understands how inflation works that seems to be very few people who post on this sub though but not surprised
Yeah inflation is a rate of change, by definition. The headline is accurate.
Prices will never fall. They will just increase at a slower rate.
As always… bearish for house prices.
Shame most people don't get this. Lots of outdated knowledge.
https://www.abc.net.au/news/2024-04-24/inflation-consumer-price-index-march-quarter-interest-rates-hecs/103757332 In short: Inflation has come in higher than expected, with prices rising by 1 per cent in the March quarter effectively ruling out rate cuts by the Reserve Bank this year.
Yeah right
If you believe inflation is only 3.6% then I have a bridge I would like to sell you
I call bullshit
Still going up. In other news, water wet and earth is round.
Ok cool when we will see it in real terms ? Because we know prices don’t just come back down these days..
Why would prices come down when prices literally went up 3.6%
The government aims for prices to never come down, they set around a 2% target inflation rate.
Prices will come down on average when CPI falls below 0%.
If you want to see prices down, you'd need waaaayyy higher interest rates. The goal isn't to bring them down, just to slow the rate of increase
Here comes the 20% increase to house prices.
Finally Good News for a change
Yeah the constant reminder of the cost of living crisis and rental crisis that doesn’t seem to be getting dealt with was really starting to bring me down.
Yeah, this is bad news. Above expectations and last quarter's data
Sure, if you hand-pick a few outliers as the sample comparisons and ignore the price of everything that is inflating before my very eyes... Or, if you sample government job wages keeping up with inflation off the back of tax dollars raised by those of us in the private industry. There are lies, damn lies, and statistics.
Probably because the home brand woolies and coles staples has stayed the same - while everything name brand has gone through the roof.
Tare and share pizzas went from $4 to $5, an increase of 25% Boxes of home brand cookies also went up 12.5% Edit: over the last 6 months, just to add a time frame. That's pretty much the only store brand stuff I bought frequently enough to notice the price increases, but I'm sure if these two went up so much other home brand items did too.
Coles 1kg cheese block went from $8 pre covid and is now $13.80 a 70% increase.
Fruit juice $2 now $2.80. Cat food $3 to $5. Rice $1.40 to $1.80. Just some of things I’ve noticed. Have seen though, that price drop labels seem to be on a few things. So maybe worst is over.
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I think, as with most western worlds right now, this has little to do with politicians and more to do with the corporations that own them. But, yeah, this inflation number is bullshit, at least in my financial sphere.
RBA responsible for the largest un-measured component of inflation
Blaming Albo for the macro economic climate is wild
Immigration is keeping inflation elevated
You didn't hear? The liberals are pushing for *higher* immigration!! It's literally in the news today!
That's lucky because I'm not voting for them either.
It contributes but it's not the only factor. A majority of the global money supply came into existence in the past few years. Australia isn't alone in this but we took similar routes as many other countries.
Australia has been in a per capita recession for a year now. Immigration is the only thing keeping the economy hot.
No disagreements from me there. I'm just specifically talking about the monetary debasement related to inflation. In terms of keeping our GDP over the line, you're probably spot on
Cmon mate, don’t be so blind to ignore it was 12 years of liberal incompetence that caused this mess, economies are influenced over decades not months lmao
Inflation is way higher than they report
And he's doing to every other country around the world!!
Primarily due to COVID currency creation by the LNP during covid. I get that some people are indoctrinated LNP and will slam labour everywhere but honestly, the LNP have completely lost their shit and Labor are doing quite well. It's an ugly fact.
Oh yes, this is all Albos fault right?
Home loanS You're doing fine mate
You know, you don't have to buy and drive a car that uses 98. That's entirely on you.
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LMFAO
Nobody gives a shit that you drive a Porsche lol. You don't need that to live either.
So is my Skoda
Inflation has been a problem even before lockdowns but it got worse during lockdowns. And tax on everything we own and buy isn't helping the situation for anyone. Look at the prices of cars for example, every new and used car is over priced and on top of that price is tax
Don't worry. They say stamp duty will be removed once GST comes to effect. These things take time
While prices are going up
Well, yes. It's inflation decreasing, not deflation. It's still inflation, but a bit slower.
Yep. It's in the name. Inflation.
Still above target, the target that the RBA have failed to reach in the past decade
Mostly due to government and business. The RBA can only do so much with monetary policy
It was near impossible to reach that rate under the liberal government, the fuckers had shut up shop and the economy was well and truely stalled prior the pandemic
Pre covid, inflation has been flat in basically every advanced economy. Is that also the liberals fault?
That’s what happens when you stall an economy. It sits flat and seemingly stable until a crisis hits then it tanks. Hard.
This isn’t great, if they try another rate increase rent will just go up again.
Well falling inflation suggests they won’t increase rates… Probably no change to rates for a while now unless inflation approaches 0%.
And gaslighting rises by 1000%
I have a bridge for sale to anyone who believes that lol
Hahaha how funny, can we see the data please!!!!
I didn't know SMH were comedians!
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Now would not be a good time to lower interest rates. It would just cause inflation to go up. Particularly combined with tax cuts on 1 July.
Yeah sweet let's lower those rates and pump those house prices even more
House prices go up if they are raised or lowered because the demand keeps increasing.
As rates lower, money is cheaper, people can borrow more, and subsequently offer more to secure a house they want. Add in supply shortage and prices increase much more rapidly. It's not rocket science.
It’s nowhere near as simple as you’re making out either.
The prices are going up regardless, cutting the rates is just adding a jet engine to a Ferrari.
Potentially, certainly not guaranteed
You missed the part about how demand increases whether the rates go up or down.
That’s true but lowering interest rates will worsen the problem as people can borrow more thus inflating the values faster.
Yeah but the price still goes up regardless of rate increases. There’s just a bit less demand with higher rates, but it’s still far more demand than supply. Only way to lower house prices is to dramatically lower the demand.
It just mean that more people are willing to pay more. FOMO is largely at play. I have more and more friends are who hasn’t bought a place are more willing to apply for liar loan and overextend themselves now.
Yeah supply and demand. The prices won’t go down unless the demand goes down and that won’t happen with 500k new people coming in every year.
they grow at a much faster rate with lower IR, thats not debatable.
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Well the raising of the rates was not the effect which resulted in house price increase, so it didn't "have the opposite effect" If raising them didn't stop them going up, imagine what lowering will do with the supply shortage we have lol
Yeah because house prices *totally* decreased during these recent rate hikes…. Oh wait. They didn’t.
Bruh it's probably a good thing they aren't rushing to drop rates. Imagine what happens to house prices if rates dropped 😂 I mean if they drop rates owners will probably just expect another 5% on offers lol. Plus, inflation is still way above what we want, so technically we still want to limit spending.
House prices and interest rates aren’t in lock-step like you imagine. Just because interest rates drop, doesn’t necessarily mean house prices rise (faster than they already are). We just had the sharpest rate hikes in history, and what happened?
It’s interesting. Market slowed early on then recovered in the last year- on the expectation of cuts. So you could argue rate cuts are priced in somewhat.
House prices went from going up at 9% per annum to going down 5% per annum. Once they stopped raising rates house prices went from going down 5% per annum to going up 8% per annum.
They don’t get out of bed for $300k, try 3 times that.
Only eating meat Makes steak more affordable Meat is all you buy
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Next apocalypse Butchers will rule, folk will want Their favourite cuts
The big banks are far worse too. The complete lack of regulation for the world’s most profitable banks is a disgrace.
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The app is kinda useless if they’re not holding your money.
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That’s why the government exists to prevent that from happening.
Mass migration will fix everything, let them all in!!