Anthony Albanese, the prime minister, believes that Australia’s growing inflation has reached its peak.
Since 2020, inflation has increased significantly—from 0.85% to 7.3%—and has risen notably quickly in the last 12 months.
Australia’s economy was expected to peak at 8% last year, and new data that will be released on Wednesday may show how accurate those predictions were.
A slew of difficult conditions, such as rising mortgage rates, soaring energy costs, and a cost of living crisis, have strained the finances of many households.
According to Albanese, who appeared on Today, the federal treasury predicted that inflation would peak “around this time or in the first quarter of this year.”
He stated, “We certainly hope that (inflation) has peaked.
“The Russian invasion of Ukraine has an effect on the entire world, and we are not immune to it.”
Albanese did not specifically state whether Australia would prevent a recession.
I believe that the fundamentals of our economy are still quite robust, he declared.
Although “we are vulnerable to a lot of those global challenges,” he said, “the fundamentals here in Australia are still extremely robust.” He called the global economy “volatile.”
Australia’s low unemployment rate of 3.5% was praised by Albanese.
The world economy will “perilously close” to entering a recession this year, the World Bank warned last week. Weaker growth will be seen in all three of the world’s largest economies: the US, Europe, and China.
The bank reduced its prediction for global growth this year from its earlier figure of 3% by almost half, to just 1.7%.
If that prediction comes true, it will rank behind only the severe recessions brought on by the 2008 global financial crisis and the 2020 coronavirus pandemic as the weakest yearly expansion in the last three decades.
On February 7, the Reserve Bank will make its next interest rate decision, and borrowers may see a ninth consecutive increase.
In an effort to control inflation, the central bank is utilizing rises.
The impact on people’s cost of living at the present is something we are extremely aware of, Albanese remarked.
