Interest rate cut expected after inflation figures reveal

ABC NEWS (Australia)

A pre-election interest rate cut could be on the horizon after yesterday's monthly inflation figures.  While the headline number ticked up core inflation, which is the reserve bank's preferred measure, fell.

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00:00According to markets, the odds I should say of a rate cut next month did rise after yesterday's

00:08inflation figures.

00:09We saw core inflation drop from 3.5 to 3.2% in the year to November.

00:17Now the Treasurer Jim Chalmers was asked when he thinks a rate cut is going to come, obviously

00:23he didn't want to weigh into that, it is ultimately up to the Independent Reserve Bank to decide

00:29on the cash rate, but certainly the hopes are that they will provide some sort of relief

00:34to mortgage holders.

00:35If not next month, then in the months to come.

00:39What will be watched next is the quarterly inflation figures from the Bureau of Statistics.

00:44They come out at the end of this month.

00:46So lots to watch, here's the Treasurer speaking earlier.

00:50What that tells us is that we are making and have made really substantial and now sustained

00:55progress in the fight against inflation.

00:58And we're pretty confident that the worst of that inflation challenge is behind us,

01:01but we're not complacent about that because we know that people are still under pressure.

01:06So the Treasurer points out that inflation is heading towards that target range that

01:12the RBA hopes for of between 2 and 3%.

01:17And if there is a rate cut before the election, we can expect that the Labor government will

01:23continue to say that it's set the right economic settings to allow for a rate cut.

01:29But when we heard from the opposition yesterday, Shadow Treasurer Angus Taylor, he was pointing

01:33out that inflation still isn't where it needs to be.

01:37Also saying that really for Australians, they're not feeling any relief, whether it is in terms

01:42of interest rates or at the checkout.

01:45Now all of this happens as the Prime Minister, Anthony Albanese, continues his tour of the

01:49top end of Australia.

01:52Today he'll be in Kununurra in Western Australia, where he's set to announce around $200 million

01:58for housing and community infrastructure.

02:01And we'll hear from the Prime Minister a little later today, Mel.

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