Feeling poorer? Inflation is costing us all at least $50 a week

We’ve all heard about it, and now we’re all feeling it. Inflation is real, it’s sending our cost of living through the roof, and there’s no relief in sight.

After two years of governments throwing money at us throughout the pandemic, we’re now left with no choice but to stand on our own two feet and deal with soaring financial pressures, which range from the cost of a coffee hitting $5+, petrol prices hitting $2+ per litre, and $5+ for a humble lettuce.

The average couple will feel about $50 poorer each week, which doesn’t even take into account the impending interest rate increase, which will put even more strain on household finances for both home owners and renters.

So why the spike? A lot of it comes down to the Russia-Ukraine war.


Normally Russia supplies roughly a third of the world’s wheat, which makes up a sizable amount (up to 20%) of the average person’s diet. That wheat becoming scarcer is driving up grocery prices.


In addition, the sanctions on Russian oil are responsible for soaring fuel prices globally, which are also driving flow-on cost spikes for all of us.


Where to from here? Unfortunately, the outlook is grim, at least until we hear some positive news coming out of Russia and Ukraine.


And then, the elephant in the room.


Next Tuesday the Reserve Bank is going to meet and based on economic fundamentals, they’ll have no choice but to increase official interest rates. I’m expecting an increase of 0.15% to make the official rate 0.25%.


This won’t sit well with the Morrison government as it heads towards the May 21 Federal election, but the reality is ScoMo has no control over it, so he’ll have to find a way to spin it better than Warnie.