Descriptions of the latest national accounts read more like a report on a football match than the state of the economy.
A “game of two halves”, an economy “limping” along, households being “hammered” by interest rate settings, and a country “crawling” to the end of the year were just some of the insights from analysts.
Jim Chalmers faces an increasingly tough budget period, balancing inflation against a slowing economy.Credit: Alex Ellinghausen
Even Jim Chalmers admitted that with the economy enduring “weak growth”, budget policy was facing “trickier terrain” as if his beloved Brisbane Broncos had 20 seconds to run the ball from one end of the field to the other to win the premiership.
All these analogies are a reflection of how households – who account for about 60 per cent of national economic activity – have struggled to deal with high (albeit rapidly falling) inflation, high interest rates (on record-sized mortgages) and an increasing tax take (before this year’s stage 3 tax cuts).
Just as the Reserve Bank has desired, Australians are winding back their spending.
As the Bureau of Statistics noted, in the final three months of last year, the nation’s households increased spending on essentials by 0.7 per cent but cut expenditure on discretionary goods and services by 0.9 per cent.
Remember when Australians, freed from COVID-era restrictions, overran the nation’s cafes and restaurants as if their lives depended on a flat white and a chicken parmigiana? In the past three months, we have cut our spending on eating out by almost three per cent.
Tobacco, alcohol, home furnishings and clothing have also borne the brunt of our spending cuts.
A win’s a win … but the economy is only just getting over the line
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06.03.2024
Descriptions of the latest national accounts read more like a report on a football match than the state of the economy.
A “game of two halves”, an economy “limping” along, households being “hammered” by interest rate settings, and a country “crawling” to the end of the year were just some of the insights from analysts.
Jim Chalmers faces an increasingly tough budget period, balancing inflation against a........
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