RBA rates on hold. Workers shouldn’t pay the price for corporate greed

Media Release - August 1, 2023

The ACTU welcomes the Reserve Bank of Australia’s decision to hold the cash rate at 4.1%.

Whilst a pause is welcomed, working people are already being crushed under the weight of previous rises. Real wages have been going dramatically backwards. Corporate profiteering and overseas supply issues are a toxic mix that is seeing workers making tough choices when the bills come through the door.

We call on the RBA to heed what unions have being saying for over 12 months, there is no wage price spiral, the drivers of inflation are not being addressed with interest rate rises that are only hurting working people. Countries like the US and Canada have seen solid wages growth alongside a sharp decline in headline inflation.

Quotes attributable to ACTU Secretary Sally McManus:

“Last week’s CPI figures showed that family budgets are still under unprecedented pressures, another rate rise would have been catastrophic for both homeowners and renters, who see the costs passed onto them from rising rates. Workers are continuing to experience significant real wage cuts as big companies continue to price gouge.

“The mythical wage price spiral the RBA has continually referenced has not happened. The IMF’s most recent update to its World Economic Outlook stated that “wage-price spirals…do not appear to have taken hold in the average advanced economy, and longer-term inflation expectations remain anchored.

“Whilst workers are counting every dollar and cutting back wherever they can, corporate profits in Australia are still on the rise.  Australia had the third highest growth in profits in the OECD between 2019 and 2023, indicating big business is price gouging workers through this crisis.

We welcome this pause in the interest rate and hope it is an indicator of the RBA taking a different approach moving forward. Increasing interest rates has never been the solution to the real causes of inflation, finally, this is being understood”.

The ACTU Network

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