Australian inflation climbs during the September quarter πŸ’₯πŸ‘©πŸ’₯

Record-high petrol prices and leaping rents are causing an Australian inflation surge with new proof of living-cost pressures revealed after Twitter billionaire Jack Dorsey issued a ‘hyperinflation’ warning.

Australia’s headline inflation rate grew by 3 per cent in the year to September with the consumer price index at the top end of the Reserve Bank’s 2 to 3 per cent target band.

Surging petrol prices were the biggest contributor with fuel prices up 7.1 per cent in just three months.

The figures were taken before unleaded prices this month surged to new record highs as Sydney and Melbourne adjusted to life after long lockdowns.

The official data showed national unleaded prices at 153.85 cents a litre during the September quarter but as of this week, bowser prices in Australia’s biggest cities had soared to record highs above 172 cents a litre.

In Adelaide, average petrol prices have soared above 180 cents a litre, MotorMouth data showed.

Record-high petrol prices and leaping rents are causing an Australian inflation surge with new proof of living cost pressures revealed after Twitter billionaire Jack Dorsey issued a ‘hyperinflation warning’

The Australian Bureau of Statistics has revealed the extent of the price rises hours after real estate data group CoreLogic revealed national rents in September soared by 8.9 per cent to $485 a week, the fastest annual growth since July 2008.

Weekly rent increases during the past year

SYDNEY: $595 up 7.2 per cent

MELBOURNE: $450 up 1.8 per cent

BRISBANE: $491 up 9.7 per cent

ADELAIDE: $440 up 8.3 per cent

PERTH: $478 up 14.5 per cent

HOBART: $500 up 12.8 per cent

DARWIN: $561 up 20.9 per cent

CANBERRA: $633 up 9.6 per cent

Source: CoreLogic weekly median rents for the September quarter of 2021 showing annual increases

In regional areas, rents surged at an annual pace of 12.5 per cent, the fastest increase in records going back to 2005.

Regional rents are now at $452 compared with $500 in capital cities, following a 7.5 per cent annual increase.

Canberra is Australia’s most expensive capital city, with median weekly rent of $633 week, a 9.6 per cent rise.

But rent surges were even more dramatic in Perth, with leasing costs soaring by 14.5 per cent during the past year to $478 a week.

In Darwin, rents have surged by 20.9 per cent to $561.

The Northern Territory capital is now only a shade cheaper than Sydney, where rents increased by 7.2 per cent to $595.

Melbourne, which in August was plunged into its sixth lockdown, was the only capital city to see a minimal increase.

The mid-point weekly rent of $450 makes the Victorian capital a cheaper place to live than Brisbane, where rents increased 9.7 per cent to $491 and only marginally more expensive than Adelaide, where leasing costs rose 8.3 per cent to $440.

New evidence of price pressures, as economies open up from Covid restrictions, were revealed after Dorsey warned of global hyperinflation.

The 44-year-old billionaire chief executive used his social media platform, on Sunday Australian time, to warn his 5.8million followers of global mega price surges, the likes of which have historically afflicted Germany‘s Weimar Republic during the 1920s and dysfunctional dictatorships like Zimbabwe, Venezuela and Cuba.

The official data showed unleaded prices at 153.5 cents a litre during the September quarter but as of this week, bowser prices in Sydney and Melbourne had soared to record highs above 172 cents a litre. In Adelaide, average petrol prices have soared above 180 cents a litre (pictured is a stock image)

The official data showed unleaded prices at 153.5 cents a litre during the September quarter but as of this week, bowser prices in Sydney and Melbourne had soared to record highs above 172 cents a litre. In Adelaide, average petrol prices have soared above 180 cents a litre (pictured is a stock image)

‘Hyperinflation is going to change everything. It’s happening,’ he said.

He doubled down when quizzed: ‘It will happen in the US soon, and so the world.’

Dorsey issued the warning about massive price surges in the world’s biggest economy, two months after his Square group announced it would take over Australian buy now, pay later juggernaut Afterpay for $39billion.

Everybody’s Home spokeswoman Kate Colvin said housing was increasingly becoming something only the wealthy could afford in Australia.

‘Housing should be a basic right in any society but especially a wealthy advanced one like Australia,’ she said.

‘It’s essential to looking after our health, caring for family and earning an income.

‘Yet these figures show that for many, getting and keeping a house is becoming a brutal survival of the fittest.’

New evidence of price pressures, as economies open up from Covid restrictions, were revealed after Dorsey warned of global hyperinflation

New evidence of price pressures, as economies open up from Covid restrictions, were revealed after Dorsey warned of global hyperinflation

CoreLogic research director Tim Lawless said stronger demand for houses instead of apartments and a lack of rental stock had pushed up leasing costs.

‘Renters are clearly looking for lower density housing options, with house rents rising at more than double the pace of units rents over the past year,’ he said.

Australia is nowhere near having hyperinflation, an extreme phenomenon of prices surging every month, and hasn’t had double-digit inflation since the June quarter of 1983, when the consumer price index was at 11.1 per cent.

It peaked at 12.4 per cent in the September quarter of 1982, during a two-year period of double-digit price increases, as the lingering effects of the OPEC oil crisis a decade earlier pushed up production costs across the world.

Australia was also in the grip of a long drought.

Nonetheless, Covid factory restrictions across the world and a global computer chip shortage are threatening to cause the biggest upheaval in consumer prices in four decades.

The Australian Bureau of Statistics has revealed the extent of the price rises hours after real estate data group CoreLogic revealed national rents in September soared by 8.9 per cent, the fastest annual growth since July 2008. In regional areas, rents surged at an annual pace of 12.5 per cent, the fastest annual pace in records going back to 2005 (pictured are Melbourne houses)

The Australian Bureau of Statistics has revealed the extent of the price rises hours after real estate data group CoreLogic revealed national rents in September soared by 8.9 per cent, the fastest annual growth since July 2008. In regional areas, rents surged at an annual pace of 12.5 per cent, the fastest annual pace in records going back to 2005 (pictured are Melbourne houses)

In 2021, Australia’s inflation rate hit 3.8 per cent during the June quarter, which was the highest since 2008 and this was the first time in a decade it had been above the RBA’s 2 to 3 per cent target.

Still, EY chief economist Jo Masters said short-lived inflation spikes would be unlikely to see the Reserve Bank of Australia raised the cash rate from a record-low of 0.1 per cent before 2024, as promised.

‘Setting monetary policy in an environment of such uncertainty is not easy and it’s important to consider the path of least regret, particularly considering that monetary policy takes two years to feed through the economy,’ she said.

Covid lockdowns have caused the price of some goods to climb by double-digit figures.

Since the pandemic began in March 2020, the cost of furniture in Australia has soared by 14.1 per cent as more people worked from home, the official inflation data showed.

But this does not mean Australia is in danger of suffering from hyperinflation yet.

Covid lockdowns have caused the price of some goods to climb by double-digit figures. Since the pandemic began in March 2020, the cost of furniture in Australia has soared by 14.1 per cent as more people worked from home, the official inflation data showed (pictured is Cabramatta in Sydney's south-west in August)

Covid lockdowns have caused the price of some goods to climb by double-digit figures. Since the pandemic began in March 2020, the cost of furniture in Australia has soared by 14.1 per cent as more people worked from home, the official inflation data showed (pictured is Cabramatta in Sydney’s south-west in August)

The phenomenon of hyperinflation is not usually associated with developed nations and is more likely to occur as a result of war, social upheaval stopping goods from getting to market or a supply blockage pushing up the price of everyday items.

Worst hyperinflation in history

Germany: 29,500 per cent a month in October 1923

Greece: 13,800 per cent a month in October 1944

Zimbabwe: 79,600,000,000 per cent a month in November 2008

Hyperinflation gripped Weimar Republic Germany after World War I and saw money carried around in wheelbarrows during the early 1920s, following the harsh reparation demands of the French-led Treaty of Versailles.

A loaf of bread cost 200,000 million marks in November 1923 and saw Germans turn to bartering as monthly hyperinflation reached 29,500 per cent.

This kind of economic catastrophe has also gripped Zimbabwe, following the forced takeover of white-owned farms under the late Robert Mugabe and a long drought.

This African basket case from 2007 had monthly inflation of 2,600 per cent a month, on average.

But in November 2008, it was an eye-watering 79,600,000,000 per cent in a month as prices literally doubled every day.

In Venezuela, under socialist dictator Hugo Chavez’s spiritual successor NicolΓ‘s Maduro, inflation soared to 800 per cent in 2016, surging to 80,000 per cent two years later.

Cuba, living under long-term American sanctions, has also suffered from hyperinflation.

Fears about massive price increases have spurred demand for cryptocurrencies in much of the developing world where trust in the government and their central banks is low.

Australian inflation climbs during the September quarter

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