Inflation: A Wonderland for the Opportunist
It’s no secret that inflation has risen, hence pushing interest rates in an upward direction and at an alarming rate.
Interest rate rises occurring month on month at the current rate have the potential to undermine the economy and place thousands of families into a world of financial pain.
As we know, inflation can affect our clients, influencing their home loan interest rates. Only last week, the RBA increased the cash rate target by 25 basis points to 3.35 per cent. So, global inflation remains extremely high.
Commentators, both globally and locally, are discussing how out of control inflation is. The numbers are certainly supporting this opinion. But, are we being conned?
It’s super important to take a deep dive into the situation and understand what the real numbers are.
Recently, the current Labor government put a freeze on gas prices, which is not something you see every day. However, it was decided that it was time to take a stand.
Interestingly, at the wholesale level, gas prices had risen barely five percent, whereas gas prices to consumers had increased by a massive 300 per cent.
Cheese, meat, chicken and vegetables have in some cases doubled in price, however the prices for suppliers and farmers are unchanged, and in some cases, reduced.
Likewise, banks increased rates at the speed of light, yet retirees and investors still receive a pittance from their investments.
Is the current rise in inflation directly attributed to price gauging and the big corporates are stitching up the masses?
If and when inflation is back within the RBA band will Woolworths, Coles and Aldi reduce their prices?
Will the banks reduce rates by the full RBA reduction?
Borrowers, the public and small businesses are struggling. How do pensioners afford to eat? How do young families with a mortgage survive?
It’s time for an enquiry; if the raw cost of products have risen only marginally, why are we paying so much more at the register?
There is no doubt the big end of town is taking advantage of a unique situation. We know that whilst inflation is expected to decline, and that the RBA has specified that their priority is to return inflation to target, it will still be some time before inflation is back to target rates.
Who is protecting the little man, the battler?
It is clear that high inflation makes life difficult for people and damages the functioning of the economy. Therefore, it’s time to get some answers.
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