Day 10 report
Yesterday, Labor released a policy statement on workplace health and safety.
The Coalition released a policy statement on vocational skills colleges for the defence force.
And, importantly, the Australian Bureau of Statistics released the Consumer Price Index (CPI) for the September 2007 quarter.
According to Peter Martin,
The measure of inflation most watched by the [Reserve] Bank, the so-called “trimmed mean” calculated for it by the Bureau of Statistics, came in at 0.9 per cent for the September quarter, the second successive quarter it has done so, and sharply more than the 0.5 per cent and 0.6 per cent reported in earlier quarters.
The result suggests that Australia’s annualised rate of inflation is already at or beyond the top of the Reserve Bank’s 2 to 3 per cent target zone.
The other measure of underlying inflation calculated for the Bank, the so-called weighted median, came in even higher at 1.0 per cent – the worst quarterly result since 1991.
Martin also noted, that the “headline rates were artificially depressed by a change in the way the Statistician accounted for the 30 per cent childcare tax rebate. Previously paid though the tax system it was not regarded as reducing the price of childcare, but since July it has become a direct payment and been incorporated in the measured price. The change cut 33.4 per cent off the apparent price of childcare in the figures released yesterday, when in fact the price was broadly unchanged. Bureau staff told the Canberra Times that without that technical change Australia’s headline rate of quarterly inflation would have been 0.9 per cent rather than 0.7 – the same as Reserve Bank’s preferred measure.”
Consequently, according to the SMH, “markets have priced the chances of a November [interest rate] rise at 82 per cent.” The SMH also reported that “a 0.25 percentage point increase [in interest rates] … would boost the average home loan rate above 8.5 per cent for the first time since November 1996.”
On the inflation front, George Megalogenis has identified the fastest movers since the last election.
Since the last election, the CPI has averaged 3 per cent a year. Fruit and vegetable costs have jumped by more than four times that amount - 13.5 per cent a year. Petrol was double that, at 7.7 per cent; secondary education 7.5 per cent; water and sewerage 6.3 per cent.
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