by David Speers, ABC*
Analysis - The last time interest rates rose during an Australian campaign was in 2007. Inflation had hit 3 percent and the Reserve Bank was worried it might climb higher.
Scott Morrison speaking on 10 April after calling federal elections for 21 May. Photo:
Its decision to hike rates just two-and-a-half weeks before polling day didn't go down well with the Howard government, to put it mildly.
Howard, already facing a likely election defeat and with nothing to lose, offered an immediate apology to mortgage holders:
"I don't like it and I would say to the borrowers of Australia who are affected by this change that I am sorry about that, and I regret the additional burden that will be put upon them as a result."
By the end of the month, he had lost the election and his own seat.
Scott Morrison must now be contemplating how he will respond if dealt his own mid-campaign interest rate whack next week. Don't hold your breath for an apology.
Wednesday's inflation data was a shock to both the government and the Reserve Bank. They were expecting a figure with a 4 in front of it. The 5.1 percent result was another blow to the Coalition campaign. It confirmed what everyone's been feeling at the check-out: prices haven't been rising like this for decades.
Aware the inflation news was unlikely to be good, the Prime Minister addressed the media two hours before the numbers were released to prepare the ground. He acknowledged the pressure facing Australian families, reminded them of the cost-of-living hand-outs announced in the budget and pleaded with them to look overseas where the problem is far worse.
Morrison even produced a chart to demonstrate how much higher inflation is in other countries compared to "what the markets are estimating at 4.5 per cent in Australia". It's unclear whether anyone got the sharpie out to correct his chart when the real numbers came out.
Global comparisons will be little comfort
Even at 5.1 percent, Morrison is correct about inflation being worse elsewhere. And the Treasurer is correct to blame the war in Ukraine and Covid-19 supply constraints.
But international comparisons are likely to provide little comfort to those struggling to pay more for meat and seafood (up 6.2 percent), fruit and vegetables (up 6.8 percent), dwellings (up 6.7 percent) and fuel (up 35 percent). Especially when wages are limping well behind (up only 2.3 percent over the past year).
The coming days will now be consumed by speculation about how the Reserve Bank (RBA) will respond. It is no longer simply a question of whether rates will rise. It's now also a question of by how much.
After the 2007 precedent - lifting rates when inflation was at 3 percent - leaving them untouched now when inflation has soared to 5.1 percent risks being seen as a political decision.
About three million Australians hold a mortgage. Some of them have taken on eye-watering loans and have never experienced a rate rise.
Labor is already warming up for the looming RBA decision. Shadow Treasurer Jim Chalmers says a rate rise, along with sluggish wage growth and soaring cost-of-living, would represent the "triple whammy" of failed economic management.
The government's best hope is to convince voters to stick with what they know in uncertain times - managing the economy is complicated, now's not the time to risk change. Some campaigners argue the Coalition is winning as long as it keeps hammering this message and keeps the focus is on its preferred turf - the economy.
*David Speers is host of the ABC TV Insiders programme, and a former political editor at Sky News Australia.