RBA says some States feeling cost of living crisis more

Cost of living pains are affecting Australians differently depending partly on where they live, with one major State struggling. Reserve Bank assistant governor Sarah Hunter on Wednesday said economic conditions varied across the country, describing the economy as “full of lots of individuals who have their own personal experience”. But some were doing better than others, she told the Senate committee into the cost of living. “We are aware for some people right now it’s really tough,” Dr Hunter said. “Victoria is really struggling right now as one of the relative underperformers, Tasmania as well. “But equally, we can see Queensland, Western Australia [and] South Australia look like they’re doing a bit better.” The RBA announced on Tuesday it was holding the official cash rate at 4.35 per cent, giving some reprieve to mortgage holders. But the board has said there will be no cut in the rate this year as the battle to rein in inflation continues. Dr Hunter said she did not expect inflation to return to the target range of 2-3 per cent until December 2025, repeating the RBA’s forecast released on Tuesday. In a nutshell, households are more inclined to spend cash, pushing up consumer demand. But economic capacity, or the ability of business to provide services, is dwindling. Dr Hunter said the economy was full of lots of individuals who had their own personal experience. The hearing comes amid dire warnings from non-profits across the country, who say Australians are becoming poorer as they struggle to manage basic costs. More to come