Australians are poorer because of war on the other side of the world – Michele Bullock’s logic is hard to fault

As far as rallying cries go, Michele Bullock’s “we are poorer, and there is no way out of that” leaves a lot to be desired. It’s not going to win you any applause, particularly when you’re the governor of a central bank that has just announced a third rate hike. But as a blunt way to describe what the US-Israel war on Iran means for everyday households, it’s hard to fault. “Australians are poorer because of this shock to oil prices and energy prices and all the other commodity prices that are being impacted,” Bullock told journalists. “So yes, we are all feeling poorer. That’s what this has done, this war on the other side of the world.” The RBA’s latest forecasts confirm this: higher prices and lower growth. Pay packets that can’t keep pace with inflation. An economy that grows at an “anaemic” rate of 1.3% in 2026, or half the pace of the year before. Sign up for the Breaking News Australia email Not a recession, Bullock said, even in the worse of two more pessimistic scenarios considered by the central bank. But an economic malaise that Australians had dearly hoped to have escaped barely six months ago. The good news: the RBA’s experts reckon unemployment should stay reasonably steady, in the low fours, through to the end of this year. In other words, you will be poorer but you should keep your job. As silver linings go, it lacks some shine. The decent thing to do, one would think, is not to pile further pressure on mortgage holders with higher interest rates. …