The devil in the detail of GDP figures shows the inflation winter has arrived

“Skyrocketing inflation is a big challenge. Falling real wages is a big challenge. The impact of interest rate rises, that the Reserve Bank governor has flagged, a big challenge,” he said.

It’s not just a local problem.

US Treasury Secretary Janet Yellen, a former head of America’s central bank, granted overnight she had got it wrong when last year when she argued the country’s inflation pressures were largely temporary.

“I think I was wrong then about the path that inflation would take,” she told CNN.

“There have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn’t – at the time – fully understand, but we recognize that now.”

Joe Biden and Yellen are fighting their own political problems caused by high inflation with interest rates expected to again be increased later this month.

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Chalmers’ issues are more immediate. The Reserve Bank, pushed into an election campaign rate rise, will be lifting rates next Tuesday. The question is whether it will be a quarter percentage point rise or 0.4 percentage points.

On a new mortgage of $800,000, the cash rate at 0.75 per cent translates into a $320 a month increase in repayments in a little over 9 weeks.

That is real cost of living pressure, with more to come.

And it’s more than an economic issue. It is quickly becoming a political one.

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