New inflation figures show that consumer prices are rising faster than wages, with the annual rate reaching 6.1 percent, the highest level since the GST was introduced more than 20 years ago.
Follow all the latest news with our live blog.
Live updates
7 minutes ago Wednesday, July 27, 2022 at 01:51
By Shiloh Payne
The inflation rate was slightly below expectations
Angela Jackson of Impact Economics speaking to the News Channel, says the figure has been “a bit below average”.
He says the market expected an increase of around 6.3 percent.
“We’re still in that post-pandemic period where demand is very high, where we have supply constraints and inflation is here for the foreseeable future,” says Dr Jackson.
“Overall, even though that’s a bigger number, it’s probably not such a bad number.”
12 minutes ago Wednesday, July 27, 2022 at 01:47
By Shiloh Payne
People make “impossible choices” as inflation rises
Edwina McDonald, acting CEO of the Australian Council of Social Services, described the increase in interest as “absolutely devastating and overwhelming”.
“We know that for people on low incomes, for the two million people who survive on less than $70 and many on $46 a day in Jobseeker’s Pay, the increases are crushing,” he says McDonald’s
“They’re skipping meals and they’ve already stopped using the car.”
“They are accessing food relief services in high numbers, much higher than before the pandemic and will feel the increased costs.”
She says income support needs to be increased so people can access the basics.
15 minutes ago Wednesday, July 27, 2022 at 01:43
By Shiloh Payne
The cost of vegetables has increased
The main factors contributing to the increase in food were vegetables, with prices increasing by 7.3% in just three months.
ABC Business reporter David Chau describes it as “a huge increase in the price of vegetables”.
22 minutes ago Wednesday, July 27, 2022 at 01:36
By Shiloh Payne
The biggest contributor was new homes
ABC business reporter David Chau it’s in the news feed, here’s what it says about the ad:
“Taking inflation figures into account, the most significant contributor to the increase in the cost of living in the June quarter was new homes.
Construction costs increased by 5.5% and automotive fuel, the price of gasoline by 4%. This was despite the fuel tax cut.
Oil prices have risen sharply in the June quarter.
Petrol prices have been a major contributor to the rising cost of living, but the good news is that petrol prices have been falling more recently and if this continues, it should reflect favorably in the quarter of September
We expect an increase in electricity prices to offset this in September. The ABS says that shortages of building materials and labour, high transport costs such as shipping and high levels of ongoing construction activity continue to contribute to higher prices for new construction properties.
Automotive fuel: This is the eighth consecutive quarter in which fuel prices have also increased. This is the longest streak since the oil price crash of the 1970s.”
27 minutes ago Wednesday, July 27, 2022 at 01:31
By Shiloh Payne
key event
The annual inflation figure has increased by 6.1 percent
Inflation in the year to June hit 6.1 percentwhich is the highest level in 21 yearssince GST was introduced.
The Australian Bureau of Statistics’ Consumer Price Index shows prices rose 1.8 percent in the June quarter, which was slightly below the March quarter’s 2.1 percent inflation rate.
41 minutes ago Wednesday, July 27, 2022 at 01:17
By Shiloh Payne
This chart shows inflation over the years since 1948
(Provided by: ABS) 51m ago Wed July 27, 2022 at 01:07
By Shiloh Payne
Calculation of the consumer price index
In Australia, inflation is measured by looking at the different categories in which consumers spend money.
The ABS travels around the capitals to check the latest prices of thousands of items, which are grouped into 87 categories and 11 groups.
Statisticians then calculate how much prices have changed since the last survey three months earlier.
But the CPI doesn’t include everything, it doesn’t take into account the cost of land or what you’re paying for a mortgage.
1 hour ago Wednesday 27 July 2022 at 00:57
By Shiloh Payne
Here’s a look at the latest inflation figure
The latest inflation figure, calculated for the first three months of the year, was 2.1 percent.
In the year to March, this meant that the price of this basket of goods rose by 5.1 per cent.
The quarterly figure due out today from the ABS is expected to be slightly lower, at 1.8 percent according to an average of economists polled by Reuters.
But the annual figure is likely to be much higher, around 6.2 percent, because much lower quarterly price increases than last year continue to leave the data.
And many economists, including those at the Reserve Bank of Australia, expect rising prices to get even worse before things get better, with CPI tipped to hit 7% by the end of this year.
The price increase is already above this level abroad.
1 hour ago Wednesday 27 July 2022 at 00:47
By Shiloh Payne
So what is the reason everything is so expensive?
Inflation is reaching record highs around the world.
What causes inflation and what can be done to control it? Rachel Pupazzoni explain:
Space for play or pause, M for mute, left and right arrows for search, up and down arrows for volume. Watch duration: 11 minutes 4 seconds11m Why is everything so expensive? 1 hDmec ago July 27, 2022 at 12:37 a.m
By Shiloh Payne
key event
When will the figures be released?
We expect the announcement about the inflation figures to be released a 11.30 a.m.
We’ll give you all the latest details right here on our live blog.
1 hour ago Wednesday, July 27, 2022 at 12:21 a.m
By Shiloh Payne
Why is inflation so high?
It all comes down to supply and demand.
supply is the amount of something that is available i demand is the quantity that is wanted of this thing.
Probably the most basic concept in economics is that prices will adjust based on supply and demand, and vice versa.
In other words, if people want to buy more of something than is available, then the price will rise to ration the goods to those who are willing and able to pay that cost.
So with COVID, the war in Ukraine and the floods in eastern Australia, the production and distribution of many goods has been restricted.
You can read more about this from business journalists Rachel Pupazzoni, Michael Widow i Lori Youmshajekian with the following link.
1 hour ago Wednesday, July 27, 2022 at 12:15 p.m
By Shiloh Payne
Inflation data to be released
Inflation data out today is expected to show another jump in prices, already on the rise 5.1 percent annually
Good morning, I am Shiloh Payne and I’ll take you through the latest updates on the inflation numbers.
We also have a business reporter Gareth Hutchens with us to answer your questions about what the numbers mean.
So, What would you like to know?