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Chalmers must cut spending to solve inflation problem

The Australian Financial Review (AFR) •
November 03, 2026 • 09:00 AM
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Unless the treasurer and the expenditure review committee get serious about real savings in the MYEFO, the central bank could be forced to raise rates again.

Chalmers must cut spending to solve inflation problem

After keeping interest rates lower than in comparable countries during the post-pandemic inflation surge, the Reserve Bank of Australia has raised the official cash rate for the fifth time this year to an 18-year high of 4.85 per cent.

Governor Michele Bullock says that Tuesday’s Melbourne Cup Day rate rise will feel like a recession for many Australians, who will feel poorer from the inflation shock and low wage and productivity growth.

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