RBA Rate Rise Today: Is the Government Actually Fighting Inflation, or Just Blaming War?

The RBA lifted rates again today, which means the same thing it has meant every other time: households get squeezed harder, borrowers get told to be responsible, and Canberra gets another chance to act like inflation is just an imported weather event that nobody here could possibly influence.

Yes, global shocks matter. Oil matters. Shipping matters. Geopolitics matters. If conflict in the Middle East pushes up energy prices, Australians feel it. That part is real.

But if the government’s entire inflation story becomes “look over there, it’s war”, then it starts to sound less like economic management and more like excuse management.

What today’s RBA rate rise actually means

An RBA rate rise pushes up the cost of money across the economy. Variable-rate borrowers feel it first, but it spreads wider than that. Mortgage repayments rise, business borrowing gets more expensive, discretionary spending gets hit, and anyone already treading water starts swallowing a bit of it.

The whole point is to cool demand. The RBA is basically saying: too much money is still chasing not enough goods and services, and inflation is not falling fast enough on its own.

Why inflation is still sticky

Inflation is rarely one thing. It is a pile-up.

• Housing costs are still ugly, whether you rent or own.
• Insurance, energy, and essentials have stayed elevated.
• Government spending can still add heat if it is poorly targeted.
• Supply shocks from overseas can push prices higher even when domestic demand cools.

That is the uncomfortable bit. Inflation can be partly imported and still be made worse locally by weak discipline, political timidity, or a refusal to attack the actual pressure points.

Is the government doing enough?

That is the question people should be asking today, because rate rises are doing the heavy lifting while politicians mostly do the talking.

If inflation is the enemy, then what is the serious domestic plan beyond hoping the central bank bruises consumers until demand behaves?

Because right now, a lot of Australians will look at the mix and think:

The RBA keeps firing, while the government keeps explaining.

That is not a great look.

Blaming the Iran war is not a full inflation policy

If ministers start leaning too hard on the Iran war, or any other overseas conflict, they are taking a real factor and using it as a political shield.

External shocks can explain some of the pain. They do not explain why Australians always seem to end up with the same domestic solution: higher mortgage stress, higher rent stress, and another lecture about patience.

If the government wants to be taken seriously on inflation, it needs to do more than point at a map.

What a stronger response would look like

• more discipline around broad spending that adds demand without fixing supply
• faster action on housing supply bottlenecks
• less spin, more clarity on what is temporary and what is structural
• targeted relief instead of splashy measures that risk reheating the problem

None of that is easy. But that is the job.

Final word

Today’s rate rise is not just an RBA story. It is a government story too.

The central bank can keep squeezing households, but eventually people are allowed to ask whether elected leaders are doing enough to curb inflation, or whether they are just outsourcing the pain to the RBA and blaming the rest on war.

That question is not fringe. It is the one more Australians should be asking.