In short:
Jim Chalmers says the government's budget is not the main driver of inflation, but acknowledges today's figures are still "too high".
asserted
figures → say → inflation
The treasurer has downplayed the likelihood of further fuel tax discounts, citing budget pressures.
What's next?
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What → downplay → pressures
The Reserve Bank is considered likely to hike interest rates when its monetary policy board meets on Tuesday.
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board → consider → Tuesday
Treasurer Jim Chalmers is urging "perspective", with today's disappointing inflation result making another rate hike a near certainty.
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hike → urge → perspective
Facing fresh accusations from the opposition that a government "spending addiction" is putting pressure on inflation, Mr Chalmers repeated his longstanding insistence that the government's budget was playing "a helpful role" and was not a "primary driver".
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budget → face → role
"There are other factors at play," he told reporters today, naming the Middle East war and a surprising burst of private investment in data centres and other areas.
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he → be → centres
I think that's an important bit of perspective when it comes to some of the commentary that is around today," he said.
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he → think → commentary
"We've been able to manage the budget in a much more responsible way than it was being managed by our predecessors …
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it → manage → predecessors
We accept our part in the fight against inflation.
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We → accept → inflation
We take responsibility for government policy when it comes to the fiscal settings.
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it → take → settings
Odds of Cup Day rate hike increase
Today's inflation figures confirm the glum prognosis of RBA deputy governor Andrew Hauser, who last week warned that inflation was on track to be "materially worse" than the 3.5 per cent the bank forecast in August.
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bank → confirm → August
Economists responded by dialling up their expectations of a rate hike next Tuesday, which KPMG's Brendan Rynne called "locked and loaded" and Deloitte Access Economics' Stephen Smith called the "best bet on Melbourne Cup Day".
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Smith → respond → Day
Markets also upgraded their expectations of a rate hike to 87 per cent next Tuesday, and fully "priced in" a hike by the end of the year, indicating a belief that a rate hike is a near-certainty in December, if not November.
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hike → upgrade → December
Another rate hike of 25 basis points would take the rate to 4.85 per cent, its highest level since 2008.
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hike → take → 2008
Treasury secretary backs up budget
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secretary → back → budget
The Coalition pursued the government over spending levels in Question Time and in Senate estimates today, where Treasury Secretary Jenny Wilkinson backed up Mr Chalmers' assessment that the budget was not a main driver.
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budget → pursue → assessment
"We can only control what we can control," she said, adding that recent budget updates had "taken some pressure from the government out of the economy" by consistently reducing the size of the budget deficits.
"
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updates → control → deficits
We have seen public demand coming off …
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demand → see → ?
The thing that we have been surprised by has been that private demand in the economy has been stronger than we expected."
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we → surprise → economy
Pressed by Liberal deputy Jane Hume about the overall level of government spending, which remains at levels rarely seen outside of recessions, Ms Wilkinson said it was important to consider the kind of spending, not just the overall amount.
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it → press → spending
A similar point was made by RBA Governor Michele Bullock, who maintained her policy of refraining from direct comment on the government's budgets, but named private sector activity, global pressures, and poor productivity as primary drivers of inflation.
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who → make → inflation
"Continued weak productivity growth means that the economy cannot grow strongly without putting pressure on inflation.
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economy → continue → inflation
This is a fundamental challenge for the Australian economy and for everyone's real spending power over the next few years," she said.
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she → say → years
Mr Chalmers downplayed any suggestion that the government would resume its fuel excise discount, despite the continue growth in fuel prices.
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government → downplay → prices
"The budget can't afford to do that forever," he said.
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he → afford → that
"We try to be up front with people and say we need to make sure that when we provide cost of living relief, it's not counterproductive.
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it → try → relief
"[We must] strike the most effective balance between the pressures on the budget, the pressures on people, and the pressures on our economy."
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We → strike → economy
He labelled the Middle East war "disastrous for Australians, for cost of living, and … around the world" and said it was "absolutely turbocharging" inflation.
"
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it → label → inflation
From an economic point of view, the end of the war in the Middle East can't come soon enough."
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end → come → East
Speaking in Question Time, Prime Minister Anthony Albanese said economic difficulties were "not going to be solved overnight" but that the government would "continue to do everything we can to shield Australians from the worst of the impact."
Shadow Treasurer Tim Wilson said government spending had made Australia "completely vulnerable to international factors" and reiterated calls for a fuel discount offset by further spending cuts.
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Australia → speak → cuts
The Aporia
