What is your opinion regarding inflation hitting 7.3 percent?
Hey Aussie,
According to the Australian Bureau of Statistics, consumer price inflation has returned to a 32-year high after dipping to 6.9 percent in October. In November, retail sales reached an 11th consecutive record month, reducing the likelihood of the Reserve Bank of Australia pausing interest rate increases.The Reserve Bank of Australia raised the cash rate by 25bps to 3.1% at its final meeting of 2022, matching market forecasts. The move marked the eighth straight rate hike, taking borrowing costs to a level not seen since November 2012, with the board flagging more rate hikes ahead as inflation in Australia is too high.
Prior to Wednesday, Australian economists had hedged their bets about the RBA's February rate hike, with some predicting a pause for a month while the RBA digested the decision. However, the facts were not as expected.
Inflation has taken off again to reach 7.3 per cent. The CPI boost was driven by home building costs, which were up 9.6 per cent, almost entirely due to a near 18 per cent rise in material costs; food and beverage costs were up 9.4 per cent; and transport, up 9 per cent.
Marcel Thieliant, senior economist at Capital Economics said the strong inflation and retail trade results would prompt the RBA to press ahead with interest rate rises at its February meeting.
What is your opinion regarding inflation hitting 7.3 percent?
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- What is your opinion regarding inflation hitting 7.3 percent?
- How much do you expect the Australian Federal Reserve to raise interest rates at its next meeting? 50 or 25 bps? and why？
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🌟🌟🌟：这真的很难，因为高通货膨胀真的打击了所有澳大利亚人的口袋。从住房、燃料、食品、服务到普通澳大利亚人的实际工资没有跟上通货膨胀，没有什么是不上涨的。
7.3%，是多年来的最高水平。这意味着澳大利亚央行可能不得不在2023年进一步加息。澳大利亚央行必须在提高利率以降低高通胀，但又不至于过高导致严重衰退之间取得微妙的平衡。
我相信澳大利亚央行将在2月份继续加息25个基点。然而，如果高通胀继续上升，那么现金利率甚至可能上升到4%或更高。
我感受到许多澳大利亚人的痛苦，他们不得不支付越来越多的抵押贷款。我认为，在高通胀的情况下，保持投资于股票、房地产等多元化资产组合非常重要，否则我们辛苦赚来的美元将会贬值。
@Tiger_AU
For many Australians, this increase in prices is making it difficult to make ends meet. This is particularly true for low-income households and those on fixed incomes, who are being hit the hardest by the rising cost of living.
If nothing goes wrong, RBA is expected to hike 25bps in Feb. Current rates are already lagging US. Higher interest rates can have a number of negative effects on the economy, including slowing down economic growth and making it more difficult for businesses to borrow money. However, these measures are necessary to combat inflation and protect the Australian economy in the long-term
interest rates on the other hand will simply follow the above and the fed...so probably stuck at 25bp before they pause the hikes.
Bonus. 2025 to 2027, aussie will be peaking against USD and SGD, so I would expect aussie denominated assets(and cash) to be the right place to be for the next 2-3 years.
cheers!
An inflation rate of 7.3% means that for every $100 you spent this time last year, you'd need to now spend $107.30 for the same items (on average).In effect, your cash is worth less now compared to this time last year.However, there is one positive to rising rates. Interest rates on savings accounts and term FDs have been going up a lot this year, so you can now earn a much better interest rate on your savings than you could 12 months ago.
Here are a few things you can do to keep up with the rising cost of living:
Refinance your mortgage, if you haven't already. With rates rising, refinancing your home loan could save you tens of thousands of dollars.
Increase your income. If you can't get a pay rise, consider a side hustle or invest. @Tiger_AU
Even without further increases in interest rates I think things will slow down visibly soon.