Australians are poorer because of war on the other side of the world – Michele Bullock’s logic is hard to fault
RBA Governor Michele Bullock stated that Australians are poorer due to global commodity price shocks caused by the US-Israel war on Iran, which has driven higher energy prices and inflation. She emphasized that the economic outlook includes lower growth, higher prices, and wages lagging behind inflation, though a recession is not expected. Bullock also warned that government stimulus to offset household pain could complicate the central bank's efforts to control inflation.
- ▪Michele Bullock said Australians are poorer due to shocks in oil, energy, and commodity prices caused by the US-Israel war on Iran.
- ▪The RBA forecasts 1.3% economic growth in 2026, higher inflation, and wages that do not keep pace with rising prices.
- ▪Bullock warned that government attempts to compensate households could make it harder to reduce inflation and may lead to further interest rate hikes.
- ▪Unemployment is expected to remain stable in the low fours through the end of the year.
- ▪Analysts at NAB believe the RBA may raise rates again in June despite uncertainty around the conflict and the upcoming budget.
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‘Australians are poorer because of this shock to oil prices and energy prices and all the other commodity prices that are being impacted,’ Michele Bullock told journalists. Photograph: Dean Lewins/AAPView image in fullscreen‘Australians are poorer because of this shock to oil prices and energy prices and all the other commodity prices that are being impacted,’ Michele Bullock told journalists. Photograph: Dean Lewins/AAPAustralian economyAnalysisAustralians are poorer because of war on the other side of the world – Michele Bullock’s logic is hard to faultPatrick ComminsIn sobering comments, the RBA governor forecasts economic malaise due to the global fuel shock.
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