OMG. The economists are panicking.
“Interest rate cuts are off the table,” Mr Bloxham said. “The problem is that productivity is so weak that supply is constrained. So as input costs such as labour and energy rise there is no equal increase in output.”
UBS economist George Tharenou said the underlying inflation rate would overshoot the RBA’s target range and possibly prevent a further rate cut. “UBS now see RBA on hold in November and (the latest reading) limits ability to cut again,” Mr Tharenou said in a note to clients.
CBA economists have also dropped their call for an RBA rate cut in February and said the bank could be on hold for an extended period of time.
Former RBA official Jonathan Kearns said there could be another rate cut but not until May next year.
Sigh, it’s not productivity. There is nowhere for wage-push inflation to go as Untouchables pour into the labour market from India. It’s energy and cost-push inflation that are the problem.
Chicken Chalmers knows it.
He said the government’s rebates for electricity, which economists say have hidden the true headline inflation rate, could be extended if the RBA’s preferred measure did not settle within its target range of 2 to 3 per cent.
So far this year, the Chicken has dropped a 37% electricity shock, with another 20% to come.
All of this is because we can’t address the underlying problem of the gas cartel.
Meanwhile, the nation’s biggest idiots are lost.
David Littleproud says he respects the convictions of moderate Liberals pushing for a watered down version of net zero, but claims the renewables rollout is costing the region’s jobs here and now.
The Nationals leader said the energy operator had to prioritise sourcing the cheapest form of energy over emissions reductions, while also flagging the Capacity Investment Scheme should apply to all forms of energy.
“This is where we are at a point of pivot, where we can ensure we have an energy mix… you look at the people of Tomago, you look at the people of Mount Isa, Port Pirie, Whyalla who are losing their jobs,” he told Sky News.
The LNP actually has the only policy it needs to crash the price of energy: gas reservation. It took it to the last election.
In short, we have a government that at any other time would be voted out in five seconds owing to crashing living standards driven by a gas cartel it fears.
And an opposition so confused by gas cartel price hikes that it wants to throw away its electoral chances with the baby and the bathwater.
Canberra would literally rather commit suicide than address the gas cartel.
This is the stuff of failed states.
