Australia’s annual inflation has jumped to 4.6% in the March quarter, driven largely by soaring fuel costs. The stronger-than-expected result has increased the likelihood of another interest rate hike in May.
Welcome to Talking Business, a podcast produced in Melbourne Australia. The podcast is available on the Acast site, my own website, the Apple podcast store or wherever you go to get your podcasts. Or you can get it at the Business Acumen website at https://www.businessacumen.biz/.
I am Leon Gettler. My job is review and monitor the week’s news in business finance and economics. I bring it all to you every week.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website leongettler.com or whatever your favourite podcast platform is.
This is episode number 13 for 2026 and today’s date is Friday, May 1.
First, I’ll be talking to I’ll be talking to Doug Hawkins, CEO of Pancare, an organisation which raises awareness, supports families and funds research for upper gastrointestinal (GI) cancers – pancreatic, stomach, liver, bilary and oesophageal cancers. And it setting up Par5, a new innovative business program that sits within Pancare and which instead of taking on the traditional charity style approach, it’s become the broker of businesses, and Par5 uses the revenue to fund cancer research.
And I’ll be talking to independent economist Saul Eslake about the risks of recession and stagflation.
But first, let’s talk to Doug Hawkins
So what’s happening in the news?
We’re now nine weeks into the closure of the Strait of Hormuz, and the cracks are really starting to show. Governments have been raiding their emergency oil reserves to keep prices from exploding — but that can only last so long. We’re already looking at a billion barrels of lost supply, and traders are warning that the real pain hasn’t hit yet. Airlines are cutting flights, diesel prices in Europe briefly topped $200 a barrel, and American drivers are buying 5% less petrol than this time last year. The worry now is a wave-by-wave demand collapse — Asia got hit first, Africa’s next, and Europe is already feeling it. If the strait stays shut for three months, one major trading house says we’re looking at a global recession. Some analysts are stress-testing oil at $200 or even $300 a barrel. The uncomfortable truth? The world borrowed time with its emergency stockpiles — but it can’t borrow forever.
So here’s where things stand between the U.S. and Iran right now — it’s basically a staring contest. No war, but no peace either. Just an uncomfortable standoff where both sides are betting the other blinks first. Trump pulled his negotiators from planned talks in Islamabad over the weekend, saying the Iranians would just waste everyone’s time. And Iran’s firing back saying they won’t even sit down for direct talks until Trump lifts the naval blockade he slapped on Iranian ports after the ceasefire earlier this month. Here’s the thing though — Iran thinks it can outlast Trump economically. Analysts say Tehran is banking on the fact that disruptions to the Strait of Hormuz hurt the global economy fast enough to pressure Trump into moving talks along before Iran really starts to crack. And Iran’s rulers might be able to hold on for three to six months under the current pressure. But Iran’s economy is already in rough shape. We’re talking potential inflation of 49% if a deal gets done — and closer to 70% if this limbo drags on. A return to war? Possibly hyperinflation north of 120%. One Iranian political analyst put it bluntly — a conservative newspaper there called this moment more dangerous than a short-term war. Because at least war ends. This just festers. The bottom line for business? The longer this drags on, the bigger the knock-on effects for global oil, fertilizer, and supply chains. Something to watch closely.
Here’s a story that doesn’t get enough attention: climate change is quietly pushing up the price of everyday things, and economists are only just starting to measure it. They’ve got a name for it — “climateflation.” The 2022 European heatwave alone added nearly a percent to food prices and nudged overall inflation up by 0.3%. Now researchers are warning that rising temperatures could push consumer prices up by as much as 1.2% a year globally by 2035 — and food prices by up to 3% annually. It hits hardest in hotter, poorer parts of the world. But it’s not just groceries — buckled roads, warped rail lines, soaring insurance premiums — the costs keep spreading. And here’s the tricky part for central banks: they usually wait out temporary price spikes, but if extreme weather becomes the new normal, those spikes stop being temporary. A hotter world, it turns out, is also a more expensive one.
Now, our first story from home — and it’s a big one. Australia’s inflation rate has jumped sharply — up to 4.6% in the year to March, from 3.7% just the month before. Experts are pointing the finger squarely at the conflict involving Iran, which has closed the Strait of Hormuz — that’s the critical shipping channel that carries oil and key commodities like fertiliser to the rest of the world. Overnight, international oil prices pushed back above $US110 a barrel, and analysts say we haven’t seen the worst of it yet — expect petrol and diesel costs to keep feeding through into the price of pretty much everything else you buy. All of which puts the Reserve Bank in a very uncomfortable spot. Markets are now betting on a third straight interest rate hike when the board meets next Tuesday — and officials are essentially staring down what some are calling a nightmare scenario: trying to crush inflation at the same time the economy is expected to slow down significantly. It’s the kind of one-two punch that’s going to be felt in households right across the country — and we’ll be watching that RBA decision very closely.
So here’s something worth watching in Australia’s clean energy space. The Albanese government is quietly considering letting struggling wind farm projects rewrite their contracts to get more taxpayer money — and it’s all because they’re running out of time to hit that 82% renewable energy target by 2030. Here’s the background. The government has this scheme called the Capacity Investment Scheme, where developers bid competitively for revenue guarantees — basically a promise of minimum income. The idea is that competition keeps the bids lean and saves taxpayers money. Smart in theory. But a lot of these projects bid in a very different economic environment. Since then, costs have surged, interest rates went up, and there aren’t enough long-term power buyers to make the numbers stack up. So developers are now lobbying to tear up those original contracts and get better terms. The government has actually asked projects to resubmit their bids with updated cost information, and officials are putting together a package for Energy Minister Chris Bowen — though he hasn’t committed to anything yet. Now, critics are raising a fair point — if you let one group renegotiate, where does it stop? An energy researcher at UNSW called it a “moral hazard.” His suggestion: reopen the tender entirely rather than quietly renegotiate behind closed doors. The stakes are real though. Wind farms take three to four years to build. None of the fifteen wind farms backed by this scheme have even broken ground yet. The clock is ticking loudly.
The Albanese government looks set to rule out hiking taxes on Australia’s gas exporters in next month’s budget — despite real public pressure to do exactly that. The Prime Minister has been doing the rounds in Asia — Singapore, Malaysia, Brunei — reassuring trading partners that Australia is a reliable energy supplier. And that’s part of the political calculation here: with Middle East tensions running hot, now isn’t seen as the moment to spook gas investors. Behind the scenes though, Treasury was asked to model new levy options just last month. And a campaign pushing a 25% tax on gas exports — led by independent Senator David Pocock and the Australia Institute — is genuinely cutting through. Polling shows roughly 70% of Greens voters and 67% of One Nation voters support it. That’s a pretty unusual coalition. Albanese says the debate has been “disingenuous” — pointing out that gas companies already pay around $22 billion a year in taxes, royalties and the Petroleum Resource Rent Tax. Western Australia’s Premier Roger Cook has also weighed in against a new tax, and given how much political weight WA carries for Labor, that matters. So for now — no new gas tax. But this debate isn’t going away.
The Federal Government has announced one of its biggest budget moves yet — a major shake-up of the NDIS aimed at cutting 160,000 participants from the scheme by 2030 and saving up to $22 billion. The big change? Moving away from medical diagnosis as the gateway to eligibility, and instead assessing what people can actually do day-to-day — things like preparing meals, personal care, and getting around. Health Minister Mark Butler is calling it more evidence-based, but disability groups are nervous. Their concern is simple: if people lose NDIS support, the cost doesn’t disappear — it just shifts to hospitals and GPs who are less equipped to handle it, and often at a higher price tag. There are also worries about what happens to early intervention programs, which have strong evidence behind them for reducing long-term costs. The government says a technical advisory group will work through the details by year’s end — but for the 160,000 people potentially affected, the uncertainty right now is very real.
Australia’s bank branch network is in real trouble — and a moratorium on closures is doing less than you’d think to fix it. The big four banks agreed to pause regional branch closures until August 2027, with Westpac going further to 2030. But here’s the thing — banks are finding creative workarounds. ANZ has quietly cut over-the-counter cash access at 16 branches. Some lenders are reclassifying towns as “metropolitan” so the moratorium doesn’t apply. And Bendigo Bank has been quietly winding down its agency branches. In the background, smaller regional banks are picking up the slack — and they’re furious about it. A group called the Regional Banking Investment Alliance, representing 24 regional lenders, says customers are using their branches for day-to-day services while keeping their main accounts with the big banks. All the cost, none of the profit. They’re now pushing the federal government to force major banks into a $153 million cost-sharing scheme to keep regional branches staffed and open. Their argument? No taxpayer money needed — this should come entirely from the banks themselves. The big banks’ peak body says customers are simply moving online. But for rural and remote Australians, that’s not really an answer.
So, big news out of Australia’s construction industry this week. Mark Irving — the senior barrister who was brought in to clean up the CFMEU, that’s the construction union that’s been at the centre of a massive corruption scandal — he’s stepped down as administrator. Irving was appointed back in August 2024 after some pretty alarming revelations about corruption, criminality, and even violence inside the union. Since then, he’s launched multiple investigations, removed hundreds of people from their positions, and — get this — he’s even received death threats. Not exactly a nine-to-five gig. But in his resignation letter to the Fair Work Commission, Irving said the union is entering a new “rebuilding phase” — and that phase needs a different kind of leader. Basically, he’s saying: I’m a lawyer, I did the forensic cleanup work, now you need someone with union experience who can rebuild relationships and culture from the inside. In the meantime, he’s handed day-to-day powers to Michael Crosby, described as an experienced and respected union leader, while Irving stays on as senior counsel in an advisory capacity. The Australian Constructors Association called the timing “surprising” — they say real progress was starting to happen. But they also acknowledged, look, this is an incredibly high-profile role with serious personal risks, so perhaps it’s not a shock either. They’re also pushing for broader reform off the back of all this — better safety regulations, fit-and-proper person tests, and a new national construction code. And the scrutiny isn’t letting up. A commission of inquiry in Queensland resumes tomorrow for its eighth round of hearings, with staff from the Cross River Rail project set to give evidence. That project, originally budgeted at $5.4 billion, has reportedly ballooned out to $19 billion — with allegations the CFMEU deliberately disrupted work to maximise delays and cost overruns. So the cleanup continues — just with a new person holding the broom.
So here’s a number that might make you raise an eyebrow — Google, Meta, and Amazon’s cloud arm quietly shipped more than 14 billion dollars out of Australia last year. That’s money flowing from Australian customers, straight offshore to parent companies. Now, the three of them did pull in about 8.5 billion in declared local revenue — but here’s the catch. All three operate as resellers here. Meaning when an Aussie business buys an ad on Google or Meta, the local entity then turns around and pays the overseas parent for the privilege of selling that ad. So most of the money just passes through. In terms of what actually stayed here — they collectively paid 212 million in income tax and employ fewer than 5,000 people between them. Meta’s Australian arm? Just 128 staff. It actually paid its US parent a $120 million dividend last year — which was more than its entire annual profit. Google’s the biggest local employer of the three, with about 2,300 staff, and it did invest over a billion dollars into local operations. AWS grew strongly too — revenue up 20% to 4.7 billion — though three-quarters of that went back offshore. Why does this matter right now? Because the Albanese government is about to drop legislation requiring these platforms to pay news publishers for journalism shared on their platforms. Meta already walked away from its voluntary news deals back in 2024. The new laws are designed to close that loophole — so they’d pay regardless of whether they carry news or not. The charge would be roughly 1.5% of revenue if they play ball, or 2.25% if they don’t. With the kind of numbers we’re talking about, that’s not pocket change.
And following on from this, the Australian government is putting the squeeze on Google, Meta, and TikTok — pay up, or face a tax. Prime Minister Anthony Albanese has released draft legislation for what’s called the News Bargaining Incentive. The deal is simple: if big tech platforms won’t cut commercial deals with Australian news outlets, they’ll cop a 2.25% levy on their local revenues. We’re talking up to $250 million a year flowing back into Australian journalism. The carrot? Platforms that do make deals get offsets of up to 170% against that levy. And there’s extra incentive to strike deals with smaller publishers too. This replaces the previous bargaining code, which Labor says lost its teeth — especially after Meta walked away from $70 million worth of deals back in 2022, basically saying: we’re done paying for news. To be captured by this scheme, platforms need Australian revenues over $250 million and a sizeable local user base — 5 million for social media, 10 million for search. Right now, that means TikTok, Meta, and Google are all in the crosshairs. If they still won’t play ball, the government collects the levy itself and distributes the money based on how many journalists each outlet employs. One notable gap — AI platforms like OpenAI aren’t included. The government says that’s being handled separately through copyright reform. Major publishers — the ABC, News Corp, Nine, and Guardian Australia — are backing the plan, calling it critical to keeping journalism sustainable. The legislation heads to parliament in the winter sitting period. Watch this space.
And finally, next time you crack open a Tooheys, a Furphy, or a Little Creatures, there’s a good chance an AI decided it should be on the shelf waiting for you. Australia’s second-biggest brewer Lion — the company behind those brands and XXXX — has partnered with OpenAI to transform how it predicts demand for beer, wine and spirits. The result? Nearly double the accuracy in their forecasting. They reckon it’s the first deal of its kind in the beverage sector. What’s particularly interesting is what’s driving the urgency. The conflict in the Middle East and the closure of the Strait of Hormuz has sent fuel costs soaring — and when you’re constantly trucking around heavy kegs and bottles, that’s a serious problem. AI is helping Lion respond to those supply chain shocks in days rather than the weeks or months it used to take. The system factors in everything from weather and seasonality to retail trends and major sporting events to figure out when Australians are likely to want a cold one. But here’s the honest takeaway from Lion’s digital boss Robb Simpson — he says 80% of the effort wasn’t about the technology at all. It was about organisational change, getting people on board, and managing the human side of things. Oh, and they’ve also built an AI app called Joey that helps customers find a beer they’ll actually enjoy. In under ten days. Which honestly sounds like a better use of AI than most things we’ve heard this week.
And that’s it for this week.
And next week, I’ll be talking to Dale Gilham, professional trader and chief analyst at WealthWithin about what we should watch out for when we are trading in this volatile market created by the Strait of Hormuz war..
And I’ll be talking to RMIT economist Sinclair Davidson about the forthcoming budget.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website leongettler.com or whatever your favourite podcast platform is.
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