So it’s goodbye to lower interest rates – to be honest, the RBA was always looking for an excuse not to cut | Greg Jericho
Is there a release of economic data that can more quickly dash people’s hopes than inflation? Prior to Wednesday’s release of the September quarter CPI figures, there was a pretty good chance that on Melbourne Cup day the Reserve Bank of Australia would cut interest rates.Now that hope is gone.The quarterly inflation growth of 1.2% was roughly double what economists and investors were expecting:If the graph does not display click hereSo it’s goodbye to lowering interest rates – but to be honest the Reserve Bank was always looking for an excuse not to cut them.On Monday night, the governor of the Reserve Bank, Michele Bullock, was sanguine about the rise in unemployment.
She told the audience at the Australian Business Economists annual dinner that the jump in the unemployment rate to 4,5% was “a bit of a surprise” but that “monthly numbers can be volatile”,She then concluded that it “is still pretty low, compared with where it was pre-Covid”,That is not a great comparison given that in 2019 all the talk was whether we were headed for a recession,But oh well, we’re still doing better than that, so no need to cut rates!Now the inflation rate means the RBA has an easy reason to ignore rising unemployment.
Inflation in the past year rose 3.2%, up from 2.1% in the year to June.That was the fourth-biggest jump in annual inflation over the past 40 years.If the graph does not display click hereSo what happened? Where is our glorious inflation within the RBA target band of 2% to 3%?It is worth noting that the trimmed mean, which is the underlying measure of inflation that the RBA and those who constantly argued for higher rate cuts prefer to look at, is 2.
95%.The weighted median (which is another way underlying inflation is measured) is 2.85%.Both measures are still within the target band.So let’s not panic.
Things are still mostly where they should be.The CPI bounced up because, unlike the trimmed mean, it doesn’t get rid of the big jumps (or falls) in prices.The story this quarter was one of big jumps in electricity prices due to the end of the state subsidies.The rise in electricity prices accounts for about 15% of the total increase in inflation.That’s a pretty sizeable impact for something that only accounts for 1.
8% of the average total of things we spend money on.Behind electricity prices was a jump in property rates and charges, and also new dwelling purchases, which is actually the cost of building a new home:If the graph does not display click hereOne way to see just how big of an impact the state electricity rebates have had on inflation is to look at the price of electricity in Perth and Brisbane:If the graph does not display click hereThe price of electricity in Brisbane in the September quarter this year was 1,694% higher than it was a year ago, when the state rebate was in full swing.That’s not because the price of electricity has actually risen that much, but the amount paid by households has because they no longer get the subsidy.Overall, we can see that the full impact of the rebates has essentially gone, with only the federal rebate still having an impact:If the graph does not display click hereNow, you might think this is a bad thing but the whole point of the rebates was to lessen inflation when it was high, and to come off when overall inflation is lower.Before the state electricity rebates came into effect in September 2023, overall inflation was growing at 6% a year.
Now when they are taken away it is 3.2%.That is exactly how they were meant to work – take away the heat while prices are on fire, and then come back when things have cooled down.The good thing, however, is that overall most prices did not see a big jump.The inflation increase was largely driven by an increase in a small number of items that rose over the past year by more than 5%, while at the other end the number of items whose prices fell did not change.
If the graph does not display click hereOne concerning aspect is that because the inflation is being driven by electricity prices, property rates and also rents, once again the prices of “non-discretionary” items are rising faster than the more luxury items,If the graph does not display click hereIn the past year, the cost of discretionary items rose just 2,4% on average,Given richer households spend more of their incomes on these items, it suggests that once again low-income households are the ones hurting the most,The lack of interest rate cuts will also least hurt those households that have either already paid off their mortgage or took it out back when interest rates were much higher.
It’s worth remembering that both inflation and the supposed “cure” of higher interest rates can hurt younger and poorer households more than those who have plenty of savings to rely on.Greg Jericho is a Guardian columnist and policy director at the Centre for Future Work
South Africa claim historic World Cup final spot as Wolvaardt blows England away
South Africa made history in Guwahati on Wednesday, after a phenomenal innings from their captain, Laura Wolvaardt, and remarkable figures of five for 20 from Marizanne Kapp helped them to a 125-run win against England and into their first 50-over World Cup final.Wolvaardt took 115 balls to bring up a maiden World Cup hundred, which was reason enough to celebrate. But with wickets tumbling at the other end, and England looking like they might have an easy-enough chase on their hands, she unleashed a superb display of boundary-striking, adding 69 runs in 28 balls.Wolvaardt slammed four sixes down the ground and slog-swept Linsey Smith for 20 runs off the 47th over. Even when she holed out to Lauren Bell in the 48th, Chloe Tryon and Nadine de Klerk took over, hitting 16 off Smith in the 49th over as England’s best death bowler was made to resemble an amateur
Australia will target Freeman at centre in England clash, George Gregan warns
The former Australia captain George Gregan says they will target Tommy Freeman’s defending at outside-centre for England on Saturday.Steve Borthwick’s side kick off their autumn campaign at Twickenham against opponents who consigned them to a dramatic late defeat last year, and the head coach has made some notable selectorial calls.George Ford starts at No 10 instead of Fin Smith, Ford’s Sale Sharks colleague Tom Roebuck is on the wing and, most interestingly, Freeman will play at No 13.The in-form Northampton back will line up in midfield for England for the second time, switching from a more familiar role out wide. He scored four tries in the Saints’ win against Saracens last Friday wearing the No 14 jersey, and outside-centre requires a different set of skills, particularly without the ball
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The Dodgers star pitched in Game 3 just 18 hours after setting records with the bat. It’s a reminder of how he makes the miraculous seem mundaneEven Shohei Ohtani’s teammates struggle to find the right adjectives to describe him; ones that express how good he is while emphasizing how unlikely his existence is in the first place.After Monday’s Game 3, when Ohtani became the first player in postseason history to reach base nine times in a World Series game, Dodgers first baseman Freddie Freeman opted for “unicorn,” one of the more common Ohtani descriptors. Starting pitcher Blake Snell, meanwhile, put things simple and plain.“He’s going to do spectacular things all the time,” Snell said
Wallabies resume England rivalry with memories still fresh of Twickenham triumph | Angus Fontaine
Smell that? That delicious whiff, sometimes bitter, but all the sweeter for its bluster? ‘Tis the distinctive funk of Australia-England sporting acrimony back on the breeze. The Kangaroos and England battling over rugby league Tests. The Lionesses and the Matildas resuming their World Cup feud. Stuart Broad and the Barmy Army playing at villainy before the Ashes next month. And the green grass of Twickenham twitching at the Wallabies’ return this weekend
NFL’s No 1 draft pick Cam Ward victim of identity theft in $250,000 scheme
Two people armed with a number of false identities managed to fraudulently obtain a quarter of a million dollars’ worth of loans in the name of Cam Ward, the quarterback of the National Football League’s Tennessee Titans, according to authorities.Albert Weber, 42, and Cyntrelle Lash, 39, are facing charges of identity theft, bank fraud and forgery after their arrests in a case whose victims allegedly include the first overall pick in the 2025 NFL draft, his father and the business that loaned out the money in question, said Capt Jason Rivarde of the sheriff’s office in Jefferson parish, Louisiana, outside New Orleans.While attempts to contact Lash for comment were unsuccessful, Weber vehemently denied wrongdoing, suggesting the actions attributed to him were carried out by someone else who falsely assumed his identity.The case in any event highlights how increasingly common fraud involving professional athletes has become amid rises in their endorsement and salary income, as highlighted by a 2021 report from global accounting and consulting firm EY.As Rivarde put it, beginning in March, Weber and Lash worked together to secure multiple loans cumulatively worth at least $250,000 in the name of Ward, whose four-year rookie contract with the Titans is reportedly worth about $48
The Spin | Sophie Devine’s impact on women’s cricket should be measured in more than statistics
The New Zealand legend played with joy and fun, but was also a true fighter who spanned eras in the women’s gameAs the Women’s World Cup has progressed, sanding down the edges and turning up the four semi-finalists you might have predicted from the start, a sideshow has been quietly playing stage left. A down-to-earth sideshow – just like the woman herself – the Sophie Devine farewell.Devine made her New Zealand debut in October 2006, in an ODI and T20 series against Australia. Nineteen years later, still with the same open face and broad smile, she has played her final one-day international – a losing affair against England neither side will polish up for the mantelpiece. The most memorable moment came at the end with the affectionate guard of honour given to Devine by both sides and the Māori tribute led by Melie Kerr and sung by her teary teammates as the stadium emptied
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