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Deflation threat to recovery as prices crash at Depression rate – Sydney Morning Herald

Consumer prices have suffered their biggest quarterly drop since 1931 with fears they suggest the economy will struggle out of the coronavirus recession.

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The biggest fall in consumer prices since the depths of the Great Depression in 1931 has prompted concerns the economy will struggle to escape the grips of the coronavirus pandemic and force the Reserve Bank to leave official interest rates at record lows for even longer.
The consumer price index fell by 1.9 per cent in the June quarter, the Australian Bureau of Statistics reported on Wednesday, pushed down by childcare costs (a drop of 95 per cent), petrol (a fall of 19.6 per cent) and rents (…

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