Households hit by rising rates ahead of tight Federal Budget

CourierMail.com.au


QUEENSLAND households are being squeezed, with the cost of living likely to continue to rise on the back of the re-emerging mining boom.

But while struggling families will be looking to next week's Federal Budget for help, Treasurer Wayne Swan has indicated there will be no spendathon, with the Government opting for long-term measures.

Latest Consumer Price Index figures show Queenslanders have had to weather double-digit growth in electricity prices, a nearly 5 per cent hike in the cost of some foods and a 15 per cent spike in fuel bills.

It comes on top of a string of interest rate rises which have added $48 to monthly payments on an average $300,000 loan and more global financial turmoil which this week stripped billions of dollars from superannuation funds.

But the re-emerging mining boom is likely to fuel inflation – which translates to higher living costs – prompting the Reserve Bank of Australia to warn families to prepare for even more increases in official interest rates. Inflation is expected to exceed the target band of 2-3 per cent by midway through the year, rising to 3.25 per cent .

The latest CPI figures show Queenslanders already have endured fuel and utilities price rises topping 14 per cent.