Sarah-Jane Tasker: Coming out of the cost of living crisis seems long and arduous

0

When KFC plays with its menu by replacing cabbage with lettuce, you know the cost of living crisis has entered a new phase.

Even the Prime Minister weighed in on the cabbage-gate, saying, “Cabbage is not the same as lettuce. It is simply wrong.

What’s wrong is that we’re firmly in a cost of living crisis and while we can all joke about KFC’s new twist on lettuce, many families aren’t laughing because they’re already feeling financial pinch.

This crisis is unprecedented and not fueled by factors seen in other price spikes, such as rising demand and wages.

It has been fueled by a pandemic that has upended global supply chains, the war in Ukraine that shows no signs of ending, and an energy shock with no quick fix.

The West reported on Thursday that the average Australian household is spending $85.76 more a week now than 12 months ago, with food, transport and accommodation accounting for the bulk of that figure.

The housing portion of that spending will continue to rise, with the Reserve Bank of Australia raising the official exchange rate this week by an unexpected 50 basis points, with the promise of bigger increases.

The RBA hopes its rate hike plan will slow inflation, but given that pundits have told us interest rates won’t rise until at least 2024, we can’t expect them to hit their target. .

What we can say with certainty is that the cost of living crisis will get worse before it gets better and it will take months to see the wider economic effects, which will be just in time for the first budget. of the Labor government in October. .

Share.

Comments are closed.