Expert urges RBA governor to blame government spending for rate hikes
Economic director at Compare the Market has written an open letter to Reserve Bank Governor Michelle Bullock ahead of next week's RBA meeting, where an 88% chance exists of a fourth rate hike this year bringing the cash rate to 4.6%. The letter argues that inflation is being driven by government spending in the Cabinet Room rather than consumer activity, with government spending as a share of GDP currently at 26.8%, the highest level since 1986. Pressure mounts on Treasurer Jim Chalmers to reduce government spending as money markets anticipate the rate increase.
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