Treasurer Warns Companies Against Passing on Petrol Price Increases to Consumers

Strategic Insights -

Australian Treasurer Peter Costello has urged companies to refrain from using rising petrol prices as a pretext to inflate prices of their own products, citing moderate inflation of 0.9% for the September quarter and a 3% increase for the year, as per the Australian Bureau of Statistics. While inflation remains under control, Costello emphasized that companies have never been more profitable, and there is no justification for passing on petrol price increases to consumers. He also warned against the effects of second-round inflation, which can harm the economy and businesses involved.

Key Takeaways:

  • Australian Treasurer Peter Costello has warned companies against using rising petrol prices as an excuse to increase prices of their own products.
  • The consumer price index rose 0.9% for the September quarter and 3% for the year, according to the Australian Bureau of Statistics.
  • Without oil prices, inflation rose by 0.5% for the September quarter and 2.1% for the year, indicating the significant impact of rising oil prices on overall inflation.
  • Companies have never been more profitable in Australian history, and there is no justification for attempting to deceive consumers into paying more.
  • Second-round inflation is detrimental to the economy and the businesses involved, as it can create a vicious cycle of price increases and decreased consumer spending.
  • Rising oil prices have been influenced by natural disasters such as hurricane Wilma and the Iraq situation.

Statistics:

  • 0.9% increase in consumer price index for the September quarter (Australian Bureau of Statistics)
  • 3% increase in consumer price index for the year (Australian Bureau of Statistics)
  • 0.5% increase in inflation (excluding oil prices) for the September quarter
  • 2.1% increase in inflation (excluding oil prices) for the year
  • Companies have never been more profitable in Australian history (Treasurer Peter Costello's statement)

Sources:

  • "No excuse for passing on petrol price increases to consumers: Costello" by Asia Pulse, October 26 (no date mentioned)
  • Australian Bureau of Statistics (no specific date mentioned)