Hot Inflation Data Weighs on Federal Budget

Australia’s worse-than-expected inflation data in the March quarter could pose a challenge for the federal budget, according to analysts.

Inflation increased by one percent in the March quarter, up from a 0.6 percent increase in the December quarter, ABS statistics show.

Despite this, Federal Treasurer Jim Chalmers still touted figures showing annual inflation has dropped under Labor.

However, Shadow Treasurer Angus Taylor claims Australians are paying a high price for the government’s “economic mismanagement.”

Deloitte Access Economics partner Stephen Smith said the treasurer would be treading a tightrope with price pressures lingering and growth subdued.

“(March quarter inflation data) underscores the difficulty of the high-wire act the treasurer must perform when handing down the budget next month, balancing the need to provide cost of living relief for households while positioning the Australian economy for a pivot to growth after months of inertia,” he said in quotes cited by AAP.

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