It’s Groundhog Day for Aussie households.
As I noted yesterday, the gas cartel shock of the 2022 Ukraine war profiteering is once again landing on households as state subsidies roll off.
Further evidence has appeared in the credit card data. Westpac.
Energy bill relief has been a key plank of the ‘cost of living’ support provided by federal and state government over the last three years. While not captured perfectly, our card activity data shows a clear dampening influence from measures introduced in the second half of 2024 that is now reversing with some notable variations across states.
State variations provide some corroborating evidence. Qld, which saw much bigger state government energy bill relief measures, shows a much more pronounced decline in the total value of card activity in 2024 (noting that all estimates are adjusted for seasonality which is very different in the tropical north compared to Australia’s south).
This country is corrupt. Letting a foreign-owned cartel war-profiteer for a year, then subsidise that same profiteering for another two, before finally passing the cost onto households is elegant proof.
Needless to say, if this is factored into credit card spending, households are, once again, being put to the sword.
This is going to spike headline inflation, according to the RBA’s SoMP.
Though, thankfully, it will be trimmed from the mean.
I suspect the inflationary impact will be weaker than feared, owing to the smashing of consumption that comes with it.
As Albo sails off to China on his knees, Canberra is once again letting its gas cartel wreck the Australian economy.
