Cost-of-living crunch: When Aussies may start to pull back on their spending

Victoria’s flooding crisis will likely push up prices of groceries including fresh produce, but there are predictions the cost-of-living crunch will be felt by more Australians early next year.
Australian Financial Review’s economics editor John Kehoe says it’s likely the impacts of the floods will flow through to the checkout.
But he said interestingly, despite consecutive interest rate rises and the price of everyday items rising, consumer spending has stayed strong in recent months.
“The full effect of those big rate rises starting in May hasn’t really hit people’s cash flow yet, I expect that’s going to happen by the end of the year, and then we probably will start to see consumer spending slow later this year, early next year,” he told Neil Breen.
He predicted rate rises could peak early next year.
“That will be when people I think are forced to pull back on their spending, because they will really be feeling those rate rises and they have maxed the credit card out at Christmas.”
Press PLAY below to hear his analysis in full
The groceries expected to soar in price after Victoria’s flood crisisÂ