MB has exhaustively chronicled the Albanese Government’s penchant for making policy that prioritises everybody in the world over Australians.
This is obvious in foreign and domestic policy, and nowhere is it more destructive to Australians than energy.
Overnight, the ECB was able to cut interest rates for the first time in nine months, with much more ahead. TSLombard:
Having long pre-committed to easing policy in June, the ECB has finally delivered its first 25bp cut.
Ironically, this cut comes against the backdrop of improving activity indicators, higher wage growth and seemingly sticky service inflation.
But bizarre optics reflect superficial data analysis.
In fact, wages and core HICP stickiness have likely peaked, and more ECB cuts are warranted to avoid derailing a gradual recovery.
The key to European inflation’s bust is energy prices, which spiked outrageously during the outbreak of war in Ukraine and crashed spectacularly as US LNG substituted for it.
Australian gas exports supplied Asia, and China onsold many cargoes to Europe.
European electricity prices followed the gas crash:
Meanwhile, in Australia, which has an abundance of cheap gas to power cheap electricity, the Albanese Government did nothing to stop the East Coast gas export cartel from bringing European gas and power prices home.
When it did finally act, all its policy measures were full of holes, and today, the local gas price is still 500% higher than historical averages:
And local power prices are higher than in energy-poor Europe:
Albo’s energy bill shocks injected crippling price rises into every household and business in the country, particularly energy-intensive building materials.
Thus, Albo’s completely unnecessary energy crisis has also played a significant role in the housing construction collapse and rental crisis.
This is the core of Australia’s inflation problem, and the fact that the Treasury is now trying to fight it with bill subsidies is no coincidence.
But talk about how the horse has bolted. Australia now has a chronically higher inflation rate than Europe.
Ergo, due to the Albanese Government’s fear of the East Coast gas export cartel, Australians are watching their interest rate cuts transpire instead in Europe.
Gosh, we are generous people.
