Muesli and milk was becoming a luxury as inflation soared. But there are good signs the nation’s inflation pressures are finally starting to abate.
And it may be time for the Reserve Bank to take a breath from scaring every person with a mortgage or seeking to rent a roof over their head with threats of another interest rate rise.Credit:Ordinarily, a one-percentage point increase in inflation in a single quarter would have inflation hawks warning of imminent pain from the RBA which will hold its next two-day meeting on Monday and Tuesday next week.
RBA board members may have no time for inflation, but they aren’t ready to hit the economy because blueberries are scarce and expensive. Milk and cereals had been affected by two issues – the war in Ukraine and energy. Higher interest rates aren’t going to stop those two problems. The change in thoughts on the Reserve Bank’s moves was also affected by separate figures from the ABS about retail trade.
In the two states with the largest mortgages, Sydney and Melbourne, the volume of retail sales has fallen by 1.2 per cent and 1.1 per cent since June last year. They are now back to where they were in 2021.On a per capita basis, retail volumes have tumbled for eight consecutive quarters. Over the past year, each of us are buying $109 less of stuff – be it muesli, milk or blueberries.Inflation is still uncomfortably high for both the Reserve Bank and the Albanese government.
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