Inflation

Price gouging is (almost) always good; the EU’s tariffs could have been worse; culture beats policy when it comes to fertility; time for fiscal responsibility; and the reality of industrial policy.

The RBA’s conflicting statements on uncertainty and accountability expose a dangerous pattern of misguided forward guidance and unlearned lessons, threatening its credibility and effectiveness in controlling inflation.

As the Australian government attempts to manipulate inflation metrics through targeted spending, the RBA finds itself in a balancing act between economic stability and political pressure, echoing historical tensions between Nixon and the Fed.

A closer look at the recent market rout reveals underlying concerns about Australia’s economy, and that the RBA’s next moves will be as crucial as ever.

Inflation is caused by fiscal and monetary policy, not by migrants or other supply shocks, which can only temporarily affect measured inflation by altering relative prices in the economy.