Australia has an especially bad inflation problem. So why are we only middle-of-the pack on the misery index?

Australia’s inflation is higher than in comparable advanced economies, with consumer prices rising 4.3% in the year to September and expected to increase faster by year-end. The Reserve Bank’s fifth interest rate rise of the year has added pressure on mortgage holders, but inflation alone does not capture the full picture of economic strain.

A simple “misery index”, which adds inflation and unemployment rates, puts Australia around the middle of the countries compared rather than at the worst end. Economist Jonathan Kearns says Australia’s labour market has performed better than those in New Zealand, Canada and Europe, offering some offset to faster-rising prices; the index is a crude measure and provides perspective rather than reassurance.