The nation’s top economists are biting their nails, anxiously waiting for the Reserve Bank of Australia (RBA) to make a move as inflation slows down to an annual rate of 7%. The big question on everyone’s mind is – will interest rates rise or remain steady when they meet on Tuesday?
Australian Inflation is sitting at 7% this quarter
According to the latest data from the Australian Bureau of Statistics (ABS), headline inflation rose by 1.4% in the March quarter and by 7% on an annual basis. This figure could make or break the RBA’s decision after they held the cash rate steady at 3.6% in April.
It’s like watching a suspenseful thriller, as the annual trimmed mean inflation – a measure the RBA closely monitors – also dipped from 6.9% in the December quarter to 6.6%. It seems the case for keeping interest rates on hold for a second month is strengthening, but the stubbornly high level of inflation is like an antagonist in this economic drama.
Inflation is beginning to ease
Michelle Marquardt, head of prices statistics at the ABS, is hopeful, noting signs that price rises are beginning to ease. “CPI inflation slowed in the March quarter, with the quarterly rise being the lowest since December 2021,” she said. “While prices continued to rise for most goods and services, many of these increases were smaller than they have been in recent quarters.”
In this thrilling tale of inflation, health and energy bills emerge as the main culprits for the March quarter’s price hikes. Marquardt explains, “Prices for medical and hospital services typically rise in the March quarter as GPs and other health service providers review their consultation fees, and the Medicare Safety Net is reset at the start of the calendar year.”
Would RBA interest rate rise?
So, will the RBA be the hero and keep interest rates steady, or will the interest rates rise, sending shockwaves through the economy? When asked about his predictions, Treasurer Jim Chalmers said, “it could go either way.”
“As we’ve been talking about, inflation is slowing down but it’s still very high. So the Reserve Bank will be looking at that,” Chalmers explained. “It will also be looking at the recent jobs figures, most recent jobs figures we saw that unemployment is at 3.5 per cent, that’s near a 50-year low. There’s still a lot of strong job creation because employers in many areas still desperate for staff so. There’s not much of a slow down in the jobs market. Inflation is still really strong, but, as the Reserve Bank says, the cost of living pressures and the higher interest rates are really hurting households especially low-income households.”
As this economic drama unfolds, we’ll have to wait and see what surprise twists or turns the RBA has in store for us next week.
Meet the CPA Accountant Superheroes
A small business owner is drowning in a sea of high-interest rates, struggling to find a way to cut down costs and stay afloat. Just as all hope seems lost, a team of superheroes swoops in to save the day!
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We’ve helped many small businesses overcome their financial challenges, particularly in high-interest-rate settings.
We had helped Sarah the CAFE owner to reduce her business operational cost, you can do the same
How do we do it? Let us tell you a story about one of our clients, who we’ll call “Sally” (not her real name, but we’re all about client confidentiality). Sally owns a lovely little cafe in Ashfield, serving up delicious cups of coffee and scrumptious pastries to her loyal customers. But behind the scenes, Sally was drowning in a sea of high-interest rates and spiraling expenses. She felt like she was working her fingers to the bone, but the bills just kept piling up.
Monthly Business Budget
One fateful day, Sally reached out to us for help, and our CPA accountant superheroes sprang into action. We sat down with Sally and helped her create a monthly business budget that would allow her to keep track of her spending and identify areas where she could cut costs. We also provided her with expert management consulting, helping her to streamline her operations and boost her profits.
Sarah’s business is thriving after the cost cutting from EndureGo Tax
And guess what? Sally’s cafe is now thriving, with her customers enjoying their morning brews as she watches her profits grow. And we couldn’t be prouder of the role we played in helping Sally turn her business around.
So, if your small business is struggling to stay afloat in the choppy waters of interest rates rise and increasing expenses, fear not! Our team of CPA accountant superheroes is here to help you find a way to reduce costs and sail towards success. So, what are you waiting for? Reach out today and let’s write your business’s own success story together!
Contact us and one of our professional and friendly accountant from the leading CPA accounting firm in Inner West Sydney Ashfield, Belrose Norther Beaches will contact you and help you out with your business.
