19: Inflation. Is it here to stay? In 60 Seconds
Are we about to enter a wage price spiral that Australia has seen many times before?
Inflation. Is it here to stay? In 60 Seconds
Why are prices climbing?
Australians are spending lots of money saved up during the COVID lockdowns.
The economy is playing catch up, trying to produce the goods and services being demanded.
Not enough labour and overseas shortages related to COVID aren’t helping.
Throw in the Ukrainian War, causing shortages of oil, gas and a whole range of other commodities and prices of just about everything, are going up.
Governments tell us this is temporary, but financial markets predict Australia is in for 7 interest rate rises over the next 3 years.
Eventually the average mortgage holder could be paying an extra $18,000 each year.
To afford the bigger mortgage payments, people would be forced to stop spending on lots of goods and services.
So our economy will take a dive, unless, everybody is compensated with big pay increases, which of course means, more inflation.
Join me Ross MacDowell with EY’s Chief Economist, Cherelle Murphy, when we discuss, Your Monthly Budget. Will inflation make it explode? on the Burgernomics Podcast.
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