Carrington Clarke

I've seen in previous interviews, she speaks about the fact that she thinks about her mum's friends when she's thinking about these hikes.

She knows that this doesn't play well for the Reserve Bank.

People think of it as a kind of cruel move, but she kept making the point over and over again that

the price rises that people are feeling, that's the really toxic part of this situation and that inflation is so dangerous, not just the inflation that we're seeing obviously through higher petrol prices, through higher oil prices, et cetera, but those second round impacts are what's really concerning them.

And not only did we have that update last week from Woolies and Coles talking about what they're hearing from suppliers in terms of them wanting to see price rises because their own costs have gone up,

But the Reserve Bank does have this process of meeting with companies, regular updates from them, almost in real time about the price pressures that they're seeing, including supermarkets, but other businesses.

And obviously the feedback they are receiving is that

we're actually seeing the transfer of higher energy prices into higher cost presses elsewhere, actually faster than they would have otherwise expected, partly because the economy was so tight already.

We already had inflationary pressures.

And that's why it's so concerning.

And I think part of the reason we did see this shift

at least we saw three people jump from staying on hold into thinking we needed to hike, was because they were looking at these numbers and the way that they set out these forecasts is taking into account what the money markets actually think is going to happen with interest rates, which was two further rate rises ahead of yesterday's rate hike.

And even with that, we're going to see inflation go up higher.

So I think they decided that we do need to act now because this is such a dangerous situation.

But as you say, there are so many unknowns about how long this will go for.

And the other thing, crucially, the other thing that they're taking into account is

when they look at deciding what they think the oil price will be, is just what the markets are telling them.

And the markets are still expecting that this crisis is going to be over pretty soon, and we're going to see a dramatic fall in the oil price.

Now, mind you, that's what they've been predicting for the last few weeks as well, and it just hasn't come to fruition.

Including today, where apparently Project Freedom lasted for, what, 24 hours?