UBS economists have warned that some businesses are using the recent ban on credit card surcharges as a justification for larger price increases than initially anticipated.
The ban, which took effect on 1 October, was part of Reserve Bank reforms intended to improve transparency for consumers. While the RBA predicted a minor increase in inflation, UBS economists believe this estimate is too low, suggesting businesses, including cafes, are passing on broader cost pressures beyond just the transaction fees.
Data from a coffee price tracker indicates that a significant percentage of cafes have raised prices since the ban, with increases far exceeding typical surcharge amounts. UBS economists noted that resilient consumer demand and persistent inflation expectations may be enabling these broader price adjustments.
Also read:Anti-drug activist Parvinder Singh Jhota shot dead in Punjab
Source: theguardian.com
