…By Judah Olanisebee for TDPel Media.
The Governor of the Reserve Bank of Australia, Philip Lowe, has raised concerns about the potential impact of significant wage increases on inflation.
While acknowledging the societal desire to protect the lowest-paid workers, Governor Lowe emphasizes the need to prevent higher inflation from translating into across-the-board wage increases, which could perpetuate inflationary pressures.
The Reserve Bank is particularly worried that significant wage rises without corresponding productivity improvements may lead companies to pass on higher costs to consumers, further fueling inflationary pressures.
Recent data highlights increasing petrol prices, holiday travel costs, accommodation expenses, and electricity prices as contributors to inflation.