'Worst possible time': Treasurer warns inflation will exceed 8% on fruits and vegetables due to floods

Federal Treasurer Jim Chalmers says widespread flooding on the East Coast will force inflation over 8% for fruits and vegetables over the next six months.

The floods inundated some of Australia's most productive farmlandMr. Chalmers says it's too early to put an exact price on the cost of the floodsInflation is expected to reach 7.5% by the end of the year

Mr. Chalmers is preparing to present its first budget next Tuesday and says the flood disaster will affect the country's economic growth by 0.25% in the December quarter.

Some of Australia's most productive farmland has been inundated by floodwaters across New South Wales, Victoria and Tasmania.

"The main continuing contributor to the 'inflation will increasingly be the impact of these natural disasters and the impact of higher electricity prices,' he said.

"What we see in these flood affected communities will be felt during the December quarter and the March quarter.

"We know that these natural disasters come at the worst possible time for communities. farmers and for Australians who are already under the pump."

Mr Chalmers said it was too early to put an exact figure on the cost of the floods in next Tuesday's budget.

< p class="_1g_Rg">"We know there will be consequences for the economy and the budget," he said. he said.

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"What we are ying to do, at this stage tar dif… is to include some of these preliminary assessments of the likely impact in the figures to be released on Tuesday evening."

Millions of Australians are currently facing a cost crisis of life as wages struggle to keep up with soaring inflation.

In June, inflation hit 6.1%, a high in 21 years, and as wages in some industries begin to rise, economists generally expect it to take at least two years for wage growth to outpace the rate of inflation.

Overall inflation is expected to reach 7.5% by the end of the year.

Treasurer said it was not not all bad news, with things like the rising cost of gas getting colder than expected.

"It's seesaws and roundabouts", he said.

Mr. Chalmers also said the government had set aside $3 billion for any additional disaster payments the Commonwealth would have to make as a result of the ongoing floods.