Much of the public opposition to further rate increases seems to assume that current unemployment rates are sustainable. The ACTU and left-wing think tanks argue that tight labour and housing markets will not lead to accelerating wages, prices and rents.

That is contrary to what happened in 2008 and the 1970s and to overseas experience. It is possible that relationships have changed, but I am not aware of any modelling or other research indicating this is likely, just wishful thinking.

This opposition to policy tightening rests on a refusal to make difficult decisions or to accept unpleasant trade-offs.