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There's another way to fight inflation. So why isn't Australia using it? (www.sbs.com.au)
submitted 1 week ago by to c/ausfinance@aussie.zone
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Raising compulsory super could do the same job as raising interest rates — but the money is yours. So why aren't we talking about it?

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[–] 8 points 1 week ago (1 child)

This has the same issue as raising interest rates as a form of inflation control; inflation is not currently being driven by discretionary spending, so reducing discretionary spending has limited effectiveness.

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  • [–] 1 point 1 week ago (1 child)

    inflation is not currently being driven by discretionary spending

    Tom Lay, ABS head of business statistics, said: “The 0.8 per cent rise in June was driven by discretionary spending rising for the second month in a row at 1.2 per cent, thanks to continued strength in Transport and Recreation and culture.”

    https://www.abs.gov.au/media-centre/media-releases/household-spending-08-june

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  • [–] 1 point 1 week ago (1 child)

    That's the Household Spending Index, which is a small portion of inflation.

    "Inflation" conventionally refers to the Consumer Price Index

    The largest contributors to annual inflation were Housing (+6.8%), Food and non-alcoholic beverages (+3.3%) and Recreation and culture (+3.3%).

    Only one of those categories is considered discretionary. Note that the CPI infamously excludes mortgages.

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  • [–] 1 point 1 week ago* (last edited 1 week ago)

    Yeah, you said inflation not driven by discretionary when it clearly has a role to play

    https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/jun-2026#analytical-series

    Following the Middle East conflict, non-discretionary inflation has spiked up to the 5%, driven by increases in automotive fuel prices

    I mean if one switches to an EV for example that counts as a discretionary purchase but that then lowers the demand of non-discretionary fuel prices

    I think I hate this discussion

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