haidi: good morning, welcome to daybreak australia. annabelle: we are counting down to asia's major market open. shery: the top stories this hour. the deadlock over the u.s. debt ceiling drags on in washington. kevin mccarthy saying no progress is made in his meeting with president biden. haidi: the debt ceiling impasse dragging investor sentiment. shery: australia's budget returns to surplus for the first time since the global financial crisis. we speak to the finance minister live this hour. u.s. futures under a little bit of pressure early in the session after we had u.s. equities slumping in the newer trading session. we were talking about the debt ceiling and the impasse bringing anxiety to the markets. also ahead of cpi day. investors are on the sidelines

ahead of the big day that could lead to a lot of volatility. the likes of goldman sachs, j.p. morgan expecting cooling inflation leading to a u.s. stock rally but we have no expectations of what the numbers could look like. the idea is that the headline cpi will raise 5% year on year. it's something investors are watching closely on how that affects the rate hike path. treasury yields are higher. the two year yield remaining above 4%. oil prices gaining ground in the new york session under a little bit of pressure in the asian session as we heard the by the administration is replenishing the strategic reserves. reversing the earlier declines that we saw from the disappointing china trade numbers. haidi: we continue to watch the big political risk in the u.s..

kevin mccarthy says the talks will remain -- resume on friday. no progress was made in the meeting today. these talks were anxiously awaited. what did we learn? >> clearly no breakthrough today. both sides saying there will not be a near-term resolution. they going to come back and speak again on friday. it's hard to know where the common ground will be given that both sides are staking out their positions. speaker mcconnell said it will not default on its debt. hopefully the two sides will come together. markets are getting nervous. you saw the big movement and treasuries, short-term treasury yields as the treasury gets closer to the date in june the

janet yellen has worn when they may run out of money. markets are getting nervous. bond markets are. equity markets less so, but no breakthroughs today. focus will be on what happens friday. shery: when is x date? what does that mean when both sides are not even agreeing on a short-term extension to the debt ceiling? >> janet yellen has warned that the treasury could run out of money if they don't raise the borrowing limit. the treasury has been using all kinds of accounting tools to navigate since january to ensure there is enough money to keep things ticking over. this puts the ball back in the

politicians court. that only sets up an autumn showdown with talk of a government shutdown and a default. we do know is that markets are totally spooked. janet yellen is hoping -- heading to japan this week. she has warned she's going to have to cut the talks short. not a great look when you have the u.s. treasury secretary having to leave the global stage to come back to fix up the debt ceiling negotiations. shery: this is ahead of cpi day. >> this is the other side of the coin. people are talking about cars ticking up again, there's a lot

of pressure in the services side on inflation story and if we get a fairly robust reading tomorrow, even if it doesn't stoke bets the fed will have to raise interest rates again, it lends itself out to the idea that rates are going to stay high for longer. to push back against the idea that the fed has regular room to bring down borrowing costs. when you consider that you have the debt ceiling on one side, inflation story eroding living standards and what policymakers are having to do there, that lends itself to the idea the u.s. will have a bumpy half of the year. those are combined significant headwinds. haidi: typically in times like this, you might be able to rely on the cyclical nature of china, but we've spoken to so many who say that china cannot save the rest of the world this time because its own rebound

trajectory is so uncertain. >> it's obviously tortured talking point when you talk about how much china contributes to global growth. a sudden reopening its that would send shockwaves to the global economy, but that doesn't seem to playing out like that. the recovery seems to be driven more domestically on the consumption side may pockets of services rather than spilling over. we saw the imports yesterday it doesn't suggest that china is buying a lot of stuff from the rest of the world. nonetheless when you consider january and first -- the pressures in the u.s., that hasn't played out to a global recession because china has reopened, the economy has gotten back on its feet so it's putting a floor on the global economy at least. shery: china's reopening and the

economic recovery even though it is patchy, you guys are so dependent when it comes to imports and the economy. you are seeing surplus for the first time since the global financial crisis. my question to you is how long can this last? you have the highest interest rate since 2012, the cash rate at 3.85%. imf seems to think that you guys are doing pretty well compared to other g20 nations. the global economy starting slowdown. that's going to pose some challenges. haidi: talk about glass half-empty. [laughter] we just had our moment to gloat from this surplus. it's almost bittersweet because it seems the australian budget will return into deficit pretty

quickly. we're hearing the windfall in the 12 months through to june 2023 it's a big turnaround remarkable from the forecast of the deficit in october. we see that slide back into deficit widening into 2025. so much of the reliance when it comes to the bounce back of china, manufacturing investment at the property sector. that consumption when it comes to industrial exports have not been there. we are not going to get the impact of the employment. is this politically difficult line not just for a stroll but everywhere. -- not just for australia but everywhere.

the government has to tread the borderline methodical strategy. trying to help out a lot of the households in australia as we have seen elsewhere struggling with the cost-of-living pressures. it is a finely tuned budget bell and today we are looking out for winners and losers out of that. annabelle: it certainly was a budget targeted at disadvantaged groups. some of the sectors including consumer discretionary, real estate dropped into the close on tuesday. in terms of set up for today, it's been driven by the macro factors particulate what's happening in the u.s. with the debt limit negotiations, debt ceiling negotiations then also this look ahead to the u.s. inflation numbers coming out later. it is set to hit 5% so still

very elevated. off that, we have the asx 200 pointing to a mile dropped the open. kiwi stocks online and investors moving into the safer haven currencies. strength coming back into the dollar. investors retreating back into gold. yen also flat still holding around 135. shery: delving into some headlines that we need to follow, let's get the vonnie quinn. >> a new archery has held donald trump liable for sexually assaulting and defaming e. jean carroll. the court ordered him to pay $5 million in damages. she accused donald trump of raping her in the 1990's and defaming her by calling her a liar when she wrote about it. this has brought attention on

donald trump's fraught history with women. violent protests have broken out across pakistan as the former prime minister was in this -- arrested. his party says at least four people killed and many injured well three buildings were set on fire. the rest came soon after he repeated allegations. sri lanka's creditors have held a meeting on the nation's debt restructuring with china sitting in as an observer. unofficial says the imf and world bank reached participants from 26 nations. authority shared the governments economic status. italy has signaled to the united states that it tends -- intends to pull out of the belt and road initiative.

the prime minister reassured kevin mccarthy that her government favors an exit for the pact. they met in rome last week. italy is the only gina 7 -- g7 country in the strategy. global news powered by more than 2700 journalists and analysts in over 120 countries. i'm vonnie quinn. haidi: let's get paul allen with our first guest. paul: a surplus on the one end, we have the finance minister joining us. congratulations, the first surplus in years. you had to be careful in terms of addressing cost-of-living pressure for example, some

support for energy bills. at the same time, i dollar not spent on energy is a dollar spent somewhere else. how confident are you that these measures will push up inflation? >> dealing with the inflation challenge has been front and center in our budget considerations. we don't want to make the inflation problem worse. we are mindful of that in the decisions, but we had to make a whole range of balance and priorities. the budget is hundreds if not thousands of decisions that seeks to manage the inflation challenge, to do what we can on the cost-of-living, invest in opportunities of the future and repair the budget the same time. that's what the treasurer handed down last night did. we have big improvements in the bottom line, but that's because we bank a lot of the upward revisions in revenue.

that helps in dealing with inflation challenge. where we have made investments, we have made them in a targeted way over four years. paul: inflation seems to have peaked at 7%, falling to 6% then 3.25% in the following year. a spanner can get thrown into the works. what are the risks around inflation question mark? aligned with what. the bank has to align with the experiences of the time. we make the decision based on the best information from experts. you have to amend your decision-making. based on the information we have

and the decisions we have taken, we are confident and the clear advice from treasury is that our decisions are not adding to inflation, and fact on the energy price package which is direct support for households and businesses, that has a deflationary impact. paul: are there expectations in terms of sending a message to the reserve bank of australia that they can hold off on the rates right now? >> we let them make their own decisions and they made it clear that we should be strengthening their independence not challenging it. this is a budget made by government on decisions we have control over. the reserve bank will make decisions themselves. within mindful and the forecasts show that the impact of those interest-rate increases amongst any things -- other things are going to slow gdp in the near term. we can see they are impacting on households, household

consumption will be affected. we have been mindful of their work. making sure that our work does not at a problem for them. paul: in terms of cost-of-living pressure relief, there is something here for renters. housing rental crisis is front and center right now. it's already one dollars per fortnight. his equity make a difference when you consider how expensive the city has become an who's not to say that next week the landlord's just jack up the rents and absorb at all? >> what were trained to do in this budget is deciding on a whole range of balance and priorities. you can't see the rent in isolation of other increases or in the cost-of-living payments as well. i would say i hope landlords don't take this opportunity and they see the state of this crisis in our country they are mindful of that. we think it will add additional

support. we will pretend it will do everything for people who get assistance, but it's the biggest increase in four years. within gets affordable, something the budget could take. to see it in conjunction with other policies like medicare and cheaper medicines which we have also invested in. paul: paul: paul: paul: paul: paul: paul: the government has been almost conservative. what has been done to bring in more revenue? >> this budget has a couple places where we have increased revenue. in multinational tax and higher balance super accounts. we think they will make a meaningful difference particularly over the medium term.

the super continues to grow outside the fort estimates. this is one budget in time. we looked at how we can have spending restraint, assist with budget repair, make assistance in cost-of-living and look at the opportunities for growth particularly in the energy transition. it is one budget, the work is never finished. paul: the budget is upbeat on the outlook for china. how important was china's recovery? >> what happens in china certainly impacts our economy and we have seen that in recent years women had those trade barriers put in place. the impact that it has particularly on individual industries. we are hopeful. we want to govern our national interests, but we think dialogue with china is important and removing trade barriers has been

the front of work that the trade minister and foreign minister have been doing in the last 12 months and will continue that. paul: thank you so much for joining us. as mentioned, a lot to discuss in this budget, but the headline return to surplus. the first one in 15 years, but don't expect it to last. haidi: we will be back with paul in the next hour for more these conversations. speaking to the treasure about the budget. this is bloomberg. ♪

shery: u.s. futures muted early after stocks slumped in new york. investors watching the debt ceiling impasse but also we are ahead of the u.s. inflation report. let's explain what this means. another cpa day, fireworks am expecting. >> typically we expect another volatile trading day, but last month we didn't have any big market moves. the general consensus is if we were to get a 5% reading or something below that, stocks would rally. goldman had a note saying we

would see a 5% gain in the s&p 500. jp morgan said similar. the idea is that softer is better for stocks. the bond market still pricing in three rate cuts. i expect if the number were to come in hotter, we would see one of those rate cuts being taken away. in this equity market despite these headlines about a soft landing, a hard landing, debt ceiling drama, we have been in a tight range in between 3800 and 4200. could a different report diversion from expectations break as out of this range? perhaps.

>> all of these systematic traders were bearish lee positioned heading into the year but the fact the equity market has rallied has made these have to come back into the market in fact deutsche bank said that wants are now above neutral in their equity market positioning for the first time since 2021 but the discretionary investors think stock pickers are still not as bullish on equities. we are seeing the biggest diversions, the most bullish compared to stock pickers since 2019. this divergence between them and the stock pickers could be adding to volatility. shery: ahead of a very exciting cpi day in the u.s.. you can get around up of all of these stories in today's edition

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haidi: look at what we are watching when it comes to fx trading. the dollar is holding broad gains ahead of more debt ceiling talks the end of this week. no resolution in the latest round of talks with the but goldman sachs saying a failure to

vonnie: is expelling a canadian

diplomat and what it calls a reciprocal countermeasure. beijing has given the envoy until saturday to leave. canada expelled a chinese diplomat accusing him of foreign interference. a chinese foreign minister says beijing will react strongly to any sanctions imposed on its companies. speaking in berlin he says beijing does not want to deliver to any nation or region weapons. family and supporters of a journalists are calling for a faster resolution of her case after marking her 1000th day in detention. she has yet to receive a

verdict. beijing has accused her of providing state secrets to a foreign country. foreign minister says australia will continue advocating for her released. global news powered by more than 2700 journalists and analysts in over 120 countries. shery: we're waiting for president biden to speak anytime now. kevin mccarthy dashed hopes to debt resolution after the meeting that happened in the white house. the first in three months between the two leaders. our next guest says the national debt is unsustainable and worries about more subtle forms of trout -- trouble if there is a government shutdown. great to have you with us. we know this is a repeated event in the u.s.. we seem to go into the 11th hour

every now and again. how higher the stakes this time around? >> the stakes are really high especially when we look at debt as share gdp -- a share of gdp. we wanted to ideally be around 70% and we will get to 200% in about three years. -- and about 30 years. that is suggesting markets might punish the u.s. for having really outsized debt and for all of the rancor we are seeing an congress in terms of not resolving this in good time. shery: we know that if we were not to get to a resolution in washington, the financial markets will be very volatile. the uncertainty will weigh on the markets. what can we expect when it comes to the economic impact of it?

guest: certainly if you have a breach in the debt ceiling, we're looking at an instantaneous crisis, instantaneous recession in the u.s. and also globally. something along the lines of what we saw during the pandemic. that can't be good for markets, it can be good for consumers or business. haidi: we're going to give your moment may be to get a glass of water. i hate that feeling when you need to cough. one of the issues is that this debt ceiling situation as you pointed out we come to every so often in the u.s., now it coincides at a time when things are fragile economically. we are still facing a lot of uncertainty when it comes to the monetary policy what the path

looks like, will we see the fed thinking they can afford to come through with a pause? critical inflation data is going to be key to forming market expectations. it comes at a time when global growth and the potential for china to come to the rescue with a strong broad recovery is perhaps not necessarily on the agenda either. shery: politically speaking as well. very uncertain environment right now. we have heard from mitch mcconnell that he is not going to come to the rescue to break this impasse. we even heard secretary yellen cautioning about invoking the 14th amendment which states the validity of u.s. debt shall not be questioned and it is seen by some as invalidating the concept of the debt ceiling. there has been all sorts of talks right now to get to resolution. both sides including house

speaker mccarthy and the white house pushing back against the idea of implementing short-term extension to the ceiling. what happens then if you have the u.s. debt ceiling, the limit approaching and the idea of this catastrophic technical default? we have heard everything from intentionally going into recession, causing more market volatility. there isn't that much time for both sides to find an agreement. we are talking about today being the first of seven days this month when you have both chambers of commerce -- congress available. also president biden scheduled to be in the u.s. capitol in order to get to a deal at some point. this as we have these estimates about when the government will exhaust its options to find itself at the x date what

secretary janet yellen has put as early as june. haidi: the house speaker dashing any hopes in the talks today. he said he did not see any new movement in they will meet again on friday. mitch mcconnell also downplaying the likelihood of a default. in the markets we sought relative stability but the likes of goldman sachs morning for more volatility and real risk being dealt to the dollar. is there a real risk to u.s. assets at this point? guest: yes, there certainly is. if we have a sovereign debt downgrade rating that means you will see higher cost, lots of volatility and this time investors may punish the u.s.. that means higher costs for the government, certainly for the private sector.

higher inflation, a bad environment for the united states. haidi: how hopeful are you that we will see a resolution this week? we have been to the brink before. this is how the playbook goes. what makes it different this time for you? guest: i think it's the rancor we are seeing in washington, d.c. where there's not a willingness to compromise. many of us are talking about, maybe they will be a temporary impasse where they kick it down the road to september and match it up with pungent -- funding the budget. that will give us more time over the summer to negotiate a deal. it doesn't seem like that's in the cards. it raises the risk that we might breach. when you look at a breach in the debt ceiling, you would have a complete shutdown of almost every agency and no spending for several weeks the government. that's going to cause a massive

crisis is the u.s. will not be able to issue any date -- any debt. there will be no activity and that's going to weigh on the economy, or talking about instantaneous recession that feeds into the global economy. shery: president biden is approaching the podium to talk to the public after holding the talks with congressional leaders. pres. biden: a productive meeting with leadership about the path forward. to make sure america does not default on its debt for the first time in our history. and please come a not surprised to hear republican minority leader of the united states senate saying that the united states is not going to default, it never has and it never will. he is absolute correct. we agree to continue our discussions and we will meet again on friday. in the meantime, our staff will meet today and daily between now

and then. everyone in the meeting understood the risk of default. our economy would fall significantly into a recession, it would devastate retirement accounts, increase borrowing costs, nearly 8 million americans would lose their jobs. our international reputation would be damaged to the extreme. the last part is me, moody's didn't say that. i made it clear that default is not an option. repeated time and time again. america is not a deadbeat nation, we pay our bills and avoiding default is a basic duty of the united states congress. they did it three times under my predecessor without one time creating a crisis, rattling the markets or undermining the unshakable trust the world has an argument to pay our bills. the national debt went up 40%

under my predecessor. that's the problem we are dealing with today. i might note parenthetically in my first two years, i reduced the debt by $1.7 trillion. i told congressional leaders i am prepared to start a separate discussion about my budget and spending produce but not under the threat of default. i've already cut the deficit by $1.7 trillion in my first two years and the budget just submitted to congress cuts another $3 trillion in debt over the next 10 years, the budget that i submitted. i made it clear that we can cut spending and cut the deficit. my budget cuts $200 billion in spending by strengthening medicare's power to negotiate for lower prescription drug prices. in addition, on top of the $160

billion in budget savings we passed last year by being able to reduce the price of insulin and other drugs for those on medicare. my budget cuts $30 billion in spending on tax subsidies for big oil companies. they made 200 billion dollars. they don't need $30 billion subsidy to drill. it makes no sense. why are we handing them $30 billion tax subsidy? it's time to start than that and that's what my budget does. my budget also funds the internal revenue code so that there's enough agents to thoroughly look at the taxes of billionaires in america. the cbo says it would raise $200 billion. larry summers says it would raise twice that amount. it will raise a lot of money. why did they want to get rid of the people who would be able to do those audits?

my budget has some of the strongest antifraud proposals ever. it strengthens the number of inspectors general. i know some of you covered my arguments in the past for cutting inspectors general for how the money was being spent. they are watchdogs for taxpayers dollars and it's estimated we have saved $10 for every one dollar spent on funding inspectors general. my budget cuts wasteful spending, closes loopholes and it makes the wealthiest americans and the biggest corporations to start to pay some of their fair share. just some of their fair share. speaker mccarthy offered every different way forward. he's proposed deep cuts that i think will harm american families. many rely on medicaid for their health care and would risk losing it. there would be 30 million fewer outpatient visits to veterans.

we have to cut 30,000 law enforcement agents. fbi, dea, water patrol. 100,000 teachers and support personnel will lose their jobs. all that would hurt americans and leave folks behind. the speaker uses the l word, that i'm not telling the truth. all i ask is that you say the cut is 22% across the board, you will have to cut a lot more with the programs that are left. no, we are going to do that either. i'm not sure. i don't think they are sure what they're proposing. if republicans take cuts in defense off the table, the cuts they have to make to other programs would be even deeper than that. one last thing that is very important, the speaker is saying he's been trying to get me to sit down with him for 97 days.

97 days ago, we met in my office. i said to him at the time, i am happy to talk with you, you submit your budget, i will cement mine and we will talk about it. i don't want to get -- i think you will never me saying that. -- you all member me saying that. i submitted my plan march the ninth. he passed his the third week in april. five days afterward, i called on him to invite him to a meeting with other members of congress. over these last few days and weeks, there's a lot of politics, posturing, and gamesmanship and it will continue for a while. i am squarely focused on what matters, we are getting to work. i've said all along, let's discuss what we need to cut, what we need to protect. what new revenue we can raise and how to lower the deficit to put our fiscal house in order.

in the meantime, we need to take the threat of default off the table. as the meeting ended, i suggested we continue to meet and our staffs continue to meet and the leaders meet again on friday to continue our discussions to see what progress we made. let me end where i began, this nation has never defaulted on its debt, it never will. thank you, i will take your questions. reporter: will you rule out short-term debt limit increase and are you concerned that speaker mccarthy publicly will not take the threat of default off the table? pres. biden: i don't know what he thinks. i think he knows better. i think he knows that default will be disastrous and i think he knows what he passed could

not possibly pass anywhere in congress. it is dead on arrival. i don't know the depths of his thinking. reporter: what about a short-term debt limit increase? pres. biden: i'm not ruling anything out. i said i will come back and talk. the one thing i am ruling out his default and i won't pass a budget that causes massive cuts. i will give you one example. they want to cut the ira. they say we are spending too much giving tax breaks to people moving to renewable energy. by getting rid of those tax breaks, that we can save money. one of you probably wrote the article in today's new york times about texas. they are making significant progress on solar, wind, renewable energy, hydrogen. guess what?

they want to cut it. i don't thicken has anything to do with anything other than the oil companies don't like it. reporter: how certain are you that a default can be avoided with so little time left? pres. biden: i'm absolutely certain because you have an overwhelming number of the members of congress know it would be a disaster. reporter: you said you are certain there will not be a default. are you willing to take action to make sure it doesn't happen? pres. biden: i've been considering the 14th amendment. a man i have enormous respect for who advised me for a long time thinks that it would be legitimate but the problem is, it would have to be litigated. in the meantime without an extension, it would still end up in the same place. i will be very blunt, if we get

by this, i'm thinking at months down the road seeing with the court would say about whether or not it does work. reporter: you have time to get a deal through before the deadline ? pres. biden: i know we have the time, we could do it easily but do we have the will? reporter: there's other proposals like prioritization of payments and minting the coin. can you speak to if any of those who been studied by your staff? pres. biden: i can't, because i don't think anyone has studied that, but there have been discussions about the 14th amendment. reporter: is that the most likely unilateral -- pres. biden: i don't think that solves our problem now. i think it only solves the problem if once the court has ruled that it does apply for future endeavors. reporter: do you trust kevin

mccarthy? pres. biden: i trust he will try to do what he says. i don't how much leeway he thinks he has in light of the fact and i'm not being a wise guy, it took 15 votes for him to acquire the speakership. apparently, he had to make serious concessions to get it from the most extreme elements of his party. i just don't know. pres. biden: -- reporter: how long -- would you like to spend indefinitely? pres. biden: it should be for more than year so we can move things along. i think the discussions are somewhere in two years, but there is no certainty. reporter: speaker mccarthy's message to you behind closed doors, was that the same one that we heard from him that he will absolutely not decouple

raising the debt ceiling with cuts? did he send that message to you? pres. biden: i don't want to violate basically a trust that we have and raise possibilities in the white house in a closed meeting. reporter: today, donald trump was charged with battery and defamation. your reaction to that? pres. biden: i heard that as i was walking from room to room, but i cannot comment. reporter: what was the tenor of the meeting? shery: you've been listening to president biden after his meeting with congressional leaders at the white house. he talked about default not being an option. he said default is off the table, absolutely certain,

america is not a deadbeat nation . america pays its bills and also about kevin mccarthy's plans would hurt americans. we still don't have an agreement with congressional leaders and president biden saying he is not ruling out short-term debt limit also he is ready to talk to congress about the budget. let's ring back our guest. thank you for sticking around. the fact that he is talking about extending the debt limit hike that he is ready to talk about the budget, could this lead to a prolonged standoff where you're going to end up talking about the 2024 budget come at debt ceiling, a larger battle and at same time, so much uncertainty about the u.s. economy? >> it is certainly possible that something short-lived is passed for the summer so they can spend that time negotiating, talking and it runs up against the end of the fiscal year when we need to talk about how do we fund the

government for the next year. all of this could become a big mix of policy and challenges at the end of the fiscal year in september. it certainly is constructive that we are hearing there still continueand from the administraa breach and they are open to different possibilities to avoid one. haidi: thank you for sticking with us, we appreciate your time and your views. we continue to watch president biden delivering those remarks at the white house saying the u.s. is not a deadbeat nation and he is absolutely certain there will not be a default. here in austria, the government has introduced a budget surplus for the first time in 15 years. let's bring it our economist james mcintyre herded debt

discussions at the capitol and here in austria, it sounds like the government is trying to tread fiscal responsibility. >> the fiscal position in australia is one of the best in the world. we have seen that budget go back into what was a surprise surplus in this current fiscal year but we are projecting the deficits to reemerge, but they are small and the order of 1.3% of gdp. what's really driving the deficits is a massive correction in commodity prices. revenues have been given a major boost which delivered the surplus in the current year from the soaring gas prices that we saw if you like from the war in ukraine. the effect will be we will see decline in coal and gas prices.

they are conservative assumptions and those of the things that drive the government balance back into deficit in the future years. we might be seeing these surpluses stick around for a little longer down under. >> you want to see fiscal policy moving in tandem with monetary policy. does it do that with the spending pledges? >> there is concern that some of the governments announcements be they increases in rent assistance, handouts to deal with cost-of-living measures like electricity and health could provide bit of cross current to the rba which is working hard with the rate hikes we have seen to try to get inflation back in. in m view, we need to keep a perspective on these things. it's a small package that the government has delivered herded

only $15 billion in the context of more than $2 trillion economy. where the government has structured its measures get in front of how the cpi might treat these things lowering the price consumers will pay. we will still leave money in consumers pockets. however measures like the childcare package do provide a lot of extra labor supply potentially in the economy if we get more more households being able to afford the care for their kids allowing it to work a little bit more. haidi: australia's shadow treasurer will be with us in the next hour. this is bloomberg. ♪

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