The ABS has released cost of living indices for the March quarter, which soared on the back of rising petrol prices:
As shown above, all cohorts’ cost of living in the year ended March 2022 rose by more than the underlying inflation rate of 3.7%; although each also grew by less than headline inflation (5.1%).
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Employee cost of living (3.8%) also rose by less than Age Pensioners (4.9%) and self-funded retirees (4.4%).
The next chart plots the annual changes in cost-of-living across cohorts, with Age pensioner and Other government transfer recipient households recording the largest quarterly rises since the September 2000 quarter, following the introduction of the GST.
As expected, transport was the main contributor for all five household types, with the price of Automotive fuel rising 35.1%.
It’s hard to see how hiking interest rates will solve Australia’s inflation problem, which is mostly imported.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also Chief Economist and co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
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