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Letter: Super weapon can help fight inflation

Interest rates, superannuation and tax reform; Peter Dutton and the Voice; migration rate; health data, safeguard mechanism; Russia-Ukraine war.

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The Reserve Bank is delivering big rate rises to the property market – to control inflation, which is measured from data that includes rental costs. Rental prices are going up as landlords’ mortgages get more expensive. The purpose of raising rates is to reduce the cash flow in households.

However, about 30 per cent of Australian homes are owned outright, so this part of the population is unaffected and is now benefiting from higher savings rates, increasing the “wealth effect”.

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    Original URL: https://www.afr.com/politics/federal/letter-super-weapon-can-help-fight-inflation-20230223-p5cn52