Chalmers: inflation could reach ‘high fours’
Tom McIlroy
Jim Chalmers has confirmed Treasury modelling suggests the war and other economic conditions could push inflation in Australia to the “mid- to high fours”.
Labor has been battling sticking inflation, but economic shocks from the Middle East will make the task much harder, putting extra pressure on the Reserve Bank to lift interest rates.
Inflation is currently at 3.8%.
Private forecasts already suggest inflation will be in the high 4% range.
double quotation mark We’ve run a couple of scenarios which make it clear on some realistic assumptions about global oil prices and how that would potentially flow through to inflation, and for how long you know, if we were putting pencils down on those forecasts today, we’d have inflation peaking somewhere between the mid- to high fours.
Chalmers says the 12 May budget will be “difficult” but will include reforms, likely to include changes to the capital gains tax discount and other tax settings.
Key events
Tom McIlroy
Defence to help with top end flood clean up
The federal minister for emergency management, Kristy McBain, says the government has approved a request from the Northern Territory for Australian Defence Force personnel to assist in the wake of serious flooding.
Crews will be on the ground from tomorrow, helping with clean-up and recovery efforts around the Katherine.
“Those logistics are being worked out, but they’ll be there to assist for the next 10 to 14 days, depending on what is required in that cleanup process,” she told ABC radio.
“A number of those ADF personnel have already been assisting in their own capacities.”
Tom McIlroy
Fuel excise should be cut due to Middle East oil crisis, Canavan says
Matt Canavan tells Sky he believes there is sufficient fuel supply in Australia, despite the growing Middle East war.
“The government has to provide confidence and assurance to people that they’ve got this in hand,” he said.
double quotation mark What the government should be doing is getting a lot more information on where things are at and doing what they can to deliver things.
He says the federal government should consider a cut to the fuel excise to help households with the cost-of-living.
“I think that has to be very carefully considered,” he said.
Tom McIlroy
Labor to blame for inflation problem, Canavan says
The new Nationals leader, Matt Canavan, says Treasury forecasts suggesting inflation could reach as high as 4.5% this year proves Labor has not done enough to carefully manage the economy.
Canavan told Sky on Sunday government spending had made the situation worse, even before the outbreak of war in the Middle East.
“This government, because they couldn’t control their own budget, has put Australia in a much weaker position to withstand the shocks of these kind of crises,” he said.
double quotation mark The government has not been saving for a rainy day, and a rainy day has arrived, and we don’t really have a roof over our head.
Canavan says Australia should do whatever it can to help bring about peace, including through support to the United States.
Chalmers: inflation could reach ‘high fours’
Tom McIlroy
Jim Chalmers has confirmed Treasury modelling suggests the war and other economic conditions could push inflation in Australia to the “mid- to high fours”.
Labor has been battling sticking inflation, but economic shocks from the Middle East will make the task much harder, putting extra pressure on the Reserve Bank to lift interest rates.
Inflation is currently at 3.8%.
Private forecasts already suggest inflation will be in the high 4% range.
double quotation mark We’ve run a couple of scenarios which make it clear on some realistic assumptions about global oil prices and how that would potentially flow through to inflation, and for how long you know, if we were putting pencils down on those forecasts today, we’d have inflation peaking somewhere between the mid- to high fours.
Chalmers says the 12 May budget will be “difficult” but will include reforms, likely to include changes to the capital gains tax discount and other tax settings.
Tom McIlroy
Fuel shortages not expected, Chalmers says
Jim Chalmers has told Sky the government does not expect Australia to run out of fuel amid the ongoing war in Iran. About a fifth of the world’s oil supplies travel through the Strait of Hormuz and the growing conflict has already played havoc with international prices.
“We’ve got big stockpiles of fuel, whether it’s petrol or diesel or jet fuel, and we work around the clock to make sure that Australia doesn’t run out. We’re certainly not expecting that we will,” Chalmers said.
Asked if petrol prices could go beyond $3 a litre in Australia, Chalmers says it depends on the scale of the war.
double quotation mark We don’t have a model that has petrol prices going that high, but there’s a lot of volatility and a lot of unpredictability in the global oil market.
Chalmers says the government is working with the competition watchdog to make sure retailers are not price gouging.
Tom McIlroy
Treasurer praises officials involved with Iranian soccer team
Jim Chalmers has praised officials who assisted members of the Iranian soccer team as they considered aslyum requests in Australia.
The government confirmed on Sunday that three more members of the squad had decided to return to Iran after initially seeking protection here.
Chalmers told Sky that officials from the Department of Home Affairs had worked to assist the team in extraordinarily difficult conditions.
“They are absolutely top shelf, and they’ve been working around the clock on these issues,” he said.
double quotation mark The way these things unfold is ultimately a matter for those officials to determine they’ve done the absolute best they can by these Iranian women under extreme and extraordinary pressure, and often that requires some pretty dramatic and unusual steps, like those which you’ve described.
Good morning
Welcome to Guardian Australia’s Sunday live news blog. My name is Ima Caldwell, I’ll be bringing you the latest news today.
First up this morning, the home affairs minister, Tony Burke, confirmed three more members of the Iranian women’s football squad have left Australia. The decision means just three of the seven squad members will remain in Australia on specially granted protection visas.
In NSW, the Minns government is introducing legislation to combat property underquoting by significantly increasing penalties. More on that soon.
And on the federal politics front, we’re expecting to hear from Jim Chalmers and Barnaby Joyce on TV interviews this morning.
Stay tuned for all of that and more.
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