“Today’s inflation numbers give the Reserve Bank of Australia little room but to lift interest rates next week when the economy can ill afford it,” said Innes Willox, Chief Executive of the national employer association, Australian Industry Group.
“Everything is up – from housing, with builders passing on higher fuel and labour costs, to food and transport – with a 4.3% rise in the 12 months to September, up from 4.0% in the year to August.
“This is a worrying sign for both consumers and businesses, dealing with higher cost of living and doing business.
“Unlike earlier in the year – when high inflation was initially due to the conflict in the Middle East and fuel issues – Australia’s inflation is now very broadly based.
“Both goods and services, and tradables and non-tradables, have seen inflation rise to unsustainable levels.
“This was partly to be expected: the shock for fuel prices around Easter was always going to eventually be passed along supply chains.
“But fiscal policy settings have added fuel to the fire, with federal spending continuing to stoke demand and inflation at a time the economy can least tolerate it.
“The RBA now faces a terrible decision next Tuesday. Today’s inflation data calls strongly for a rate rise, though its consequences for a fragile economy will be far from welcome,” Mr Willox said.
