‘An economic fairytale’: Australia’s inflation being driven by company profits and not wages, analysis finds

As Australians struggle with rising interest rates and inflation, companies such as Woolworths are posting bumper profits. Photograph: Lisa Maree Williams/Getty Images

Company profits, not wages, have driven the soaring inflation in Australia, an analysis from the Australia Institute has found.

The thinktank has released evidence of what it calls a “profit price spiral”, arguing big business earnings account for 69% of the inflation that is above the reserve bank’s target range of 2-3%.