Have you been wondering why inflation is increasing in Australia again?
After holding the official interest rates for a few months the RBA kicked off November with a not-so-surprising rate rise.
The new RBA governor shrugged off political pressures and DID THE RIGHT THING
The official cash rate now sits at 4.35%.
Interest rates have increased 4.25% since May 2022.
All we been hearing for the past year,
We need to bring inflation down
Inflation erodes your savings
Inflation is dangerous
For a little while it seemed that inflation was under control and it was on a steady decline.
BUT, in October 2023, Inflation went up.
The previous RBA governor stated time and time again the the RBA can not fix the supply side of the inflation problem.
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Inflation in Australia has been on the rise recently, leading to concerns among consumers and policymakers alike. The latest figures from the Australian Bureau of Statistics show that the country’s inflation rate rose to 3.8% in the second quarter of 2021, marking the highest rate in over a decade. This surge in inflation is largely due to a combination of factors, including supply chain disruptions, rising fuel and energy prices, and increased consumer demand as the economy recovers from the effects of the COVID-19 pandemic.
So, what exactly is inflation and why should you be concerned about it? Inflation is the rate at which the general level of prices for goods and services is rising. When inflation is high, the purchasing power of the currency decreases, meaning that consumers can buy fewer goods and services with the same amount of money. This can lead to a decrease in the standard of living and create uncertainty in the economy.
In response to the rising inflation, the Reserve Bank of Australia (RBA) has signaled its intention to tighten monetary policy by potentially raising interest rates in the near future. Higher interest rates can slow down economic activity and reduce inflationary pressures by making borrowing more expensive for businesses and consumers. However, the RBA is also mindful of the potential impact that higher interest rates could have on the economy, particularly as it continues to recover from the pandemic.
So, what can you do to mitigate the impact of rising inflation on your finances? There are a few steps you can take to protect yourself against the effects of inflation. First, consider diversifying your investment portfolio to include assets that are less sensitive to inflation, such as real estate, commodities, and inflation-protected securities. Additionally, it’s important to stay informed about the latest economic developments and adjust your budget and spending habits as needed to cope with rising prices.
It’s also a good idea to consider locking in fixed interest rates on your loans and mortgages to protect yourself from potential rate hikes in the future. Furthermore, building an emergency fund can provide you with a financial cushion to weather any unexpected expenses that may arise as a result of inflation. Finally, consider consulting with a financial advisor to develop a strategy that is tailored to your specific financial situation and goals.
In conclusion, the recent increase in inflation in Australia is a cause for concern for both consumers and policymakers. While the RBA is considering measures to address the rising inflation, it’s important for individuals to take proactive steps to protect themselves against the potential negative effects of inflation on their finances. By staying informed, diversifying investments, and making prudent financial decisions, individuals can navigate the challenges posed by rising inflation and safeguard their financial well-being.
In the 80s, Volker (Fed Chairman) got interest rates 6% above inflation to finally kill it. He believes you can't tinker with rates below inflation. Of course, it will cause a huge recession, but it's the price to pay for stupid government and the central bankers for leaving rates so low for so long. WTF did they think would happen with money printing and ultra low rates.
Alban-LAZY is a clown Mr Bean ???!!!!
I wish more people open their bloody eyes and watch videos like this and understand that their elected polititians are simply thieves and traitors.
Inflation is here to stay. We have 1.5 million more migrants incoming by 2025 with no housing built in foreseeable future. Brace yourselves if you are young or renters. What about to hit you is much much worse than a recession.