- Interest rates remain on hold- for now
- Federal Treasurer promises additional cost of living relief in next Tuesday's federal budget
- And inquiry recommends that supermarkets that abuse their market powers should be broken up,
The Reserve Bank has decided to keep interest rates at their current levels for another month.
After two days of bank's board reviewing the state of the economy and progress on inflation, the cash rate will remain at 4.35 per cent.
That's where the rate has been since November last year.
The bank says the economic outlook remains uncertain, and recent data has demonstrated that the process of returning inflation to its target band, of between two and three per cent over the course of the economic cycle- is unlikely to be smooth.
The bank says it won't rule anything in or out about interest rate movements in the future.
The current headline inflation rate is 3.8 per cent.
Inflation is not forecast to get back to between two and three per cent until December 2025.
The federal opposition says the Reserve Bank's interest rate decision shows the government's economic policies aren't working.
Even though the central bank has kept the cash rate at 4.35 per cent, Opposition Treasury spokesman Angus Taylor says the government is handicapping productivity in Australia, and that higher-than-wanted inflation is the government's fault.
He likens the economic situation in Australia to that of trying to care for a car.
"It is very clear from all this that Labor's home-grown inflation is rampant. It's running wild. The Reserve Bank hasn't been able to address this. And, frankly, if the Reserve Bank has the foot on the brake, it's necessary, because this government has had its foot on the accelerator. And what you end up with with that situation, is a situation where you wreck the engine."
Federal Treasurer Jim Chalmers is promising additional cost of living relief in next Tuesday's federal budget- over and above income tax cuts.
With rents outpacing wage growth, Dr Chalmers says renters in particular are under pressure, and there will thus be measures in the budget focused on housing.
Dr Chalmers boasts the budget will show the government has been able to get debt down, in part through spending restraint and budget savings.
But he says the government is aware many people are still struggling, and will do what it reasonably can to try and help.
"The defining challenge in our economy, certainly in the near-term, is inflation. People are under a lot of cost of living pressure. That's why the budget will try and ease what we can of that pressure- primarily through a tax cut for every taxpayer, but with additional cost of living relief as well. And that's because we don't just acknowledge people are doing it tough- we're doing something about it. We did in the last budget. And we will be again in the next budget. We'll do that responsibly. We'll do what we can afford to do. But we know people are under the pump."
Dr Chalmers is warning that international instability- such as higher oil prices due to conflict in the Middle East, and supply chain problems due to the war in Ukraine- will still be a factor in the budget.
Farmers will soon be able to access more support to help prepare for drought with a new government investment.
Prime Minister Anthony Albanese and Minister for Agriculture Murray Watt made the announcement of an extra $519 million investment into the Commonwealth's future drought fund to help regional communities ready for dry times as part of next week's federal budget.
As part of the boost, $235 million will go towards drought resilience programs, while $137.4 million will be channelled into measures to assist producers with business planning and financial literacy.
Trials for new solutions to drought mitigation will also be funded with a further $120 million.
Minister Watt says the fund aims to provide tools for farmers to manage drought on their properties as well as prepare for the climate challenges of the future.
"The reason we need to do that is that too often in the past, governments have waited until droughts have happened and then put forward a chaotic, urgent response that hasn't dealt with the underlying problems, and we want to change that. Over half a billion dollar investment will do really practical things. It will help farmers learn what they can be doing on farm to make themselves ready and make their income streams ready for future drought sharing climate science with our farmers so they know how to get better prepared."
Supermarkets that abuse their market powers should be broken up, while laws banning price gouging at the check-out should be introduced, an inquiry into the grocery sector recommends.
A Senate committee examining supermarket prices handed down its final report, laying out 14 recommendations for reform in the sector.
The report called for laws to break up the supermarket duopoly of Coles and Woolworths, should supermarkets carry out "unconscionable conduct".
The Greens-led inquiry also called for the government to set up a prices and competition commission to examine the price setting practices of supermarkets as well as other industries.
Discounts across supermarkets should also be standardised, along with the promotional terms used to stop fake discounts.
It also recommended the Food and Grocery code of conduct, which governs the relationship between supermarkets and supplies, be made mandatory.
