RBA interest rate hike: Angus Taylor blames Albanese Government for increasing taxes

Opposition Leader Angus Taylor has blamed the RBA’s interest rate hike on excessive federal spending and accused the Albanese government of “coming after” Australians with higher taxes.

The RBA lifted the cash rate by 0.25 percentage points to 4.35 on Tuesday, its third consecutive rate hike this year.

The board said inflation was too high at 4.6 per cent, well above its target range of 2-3 per cent, and did not rule out further rate hikes.

RBA governor Michelle Bullock said both private sector and government spending had contributed to demand but highlighted the Iran war as having a major impact.

But on Wednesday, Mr Taylor told Channel 9 the higher interest rates – used as a tool to cool inflation – were caused by federal spending having “gone up too fast”.

“The Treasurer told us and the Prime Minister told us (before the Iran war) that they’d beaten inflation. No, inflation has beaten them,” he said.

“What we would have done in government is keep control of this out-of-control spending, build the confidence that businesses can invest and the speed limit in the economy can be higher without causing inflation.

“But that’s not what we’ve got right now.”

Later, Treasurer Jim Chalmers defended Labor’s management of the economy, telling the ABC that critics were not taking into account the economic pressures triggered by the US and Israel’s war in Iran.

“I think a lot of the commentary today tries to pretend that there isn’t a major war in the Middle East pushing out prices, particularly at the bowser but also throughout our economy,” Mr Chalmers said.

“And so we need to have that perspective … Australians didn’t choose this war in the Middle East, we have no control over when it ends, but we are paying a hefty price for it at the bowser and beyond.

“And so we know that people are under a very serious pressure.”

More to come...