Research shows the carbon tax has significantly increased household utility bills, adding extra strain to Australian households.
The TD Securities’ Melbourne Institute Monthly Inflation Gauge for July showed a 14.9% rise in the cost of electricity, alongside a 10.3% increase in gas and other household fuels.
While the rises were expected in the Treasury’s predictions, it’s on the higher end of the scale.
Meanwhile, inflation remains low and GDP growth is exhibiting signs of strength, which “is an economic sweet spot and certainly backs up RBA
Governor Stevens’ glass half full chirpy theme of late,” said Annette Beacher, head of Asia-Pacific research at TD Securities.
“The June quarter GDP is shaping up to be a blockbuster due to strong private consumption and a significant rebound in the trade sector.”
She added that Australia is “well-placed to absorb global shocks, and the RBA
Board can comfortably leave cash rates unchanged at 3.5% at the meeting [today].”