KEY POINTS:
- Electricity and gas prices are expected to increase further in 2023.
- Treasurer Jim Chalmers said there had been "important progress" on energy costs and housing at the meeting.
- Deputy Liberal leader Sussan Ley said the government's plans for more spending would drive up inflation and interest rates.
Electricity and gas prices are expected to increase further in 2023 but will be "dampened" by the federal government's $1.5 billion relief plan.
That is the view of the Reserve Bank of Australia, which in its latest statement on monetary policy forecast higher wholesale energy costs.
"However, over this year and next, increases in wholesale costs are expected to be dampened by the Australian government's Energy Price Relief Plan," the RBA board said.
Treasurer Jim Chalmers seized on the comment as evidence the independent central bank had endorsed the government's plan, which was the subject of talks with state and territory treasurers on Friday.
"We are not surprised but we are very pleased to see that the independent Reserve Bank has said today our energy plan will have exactly the consequences and impact we said it would have," Dr Chalmers told reporters after the online meeting.
"We are acting decisively to take some of the sting out of these high energy prices."
He said the savings - to be detailed in the May federal budget - would not flow until the middle of the year and were still subject to the states and territories agreeing separate plans to provide their share of bill relief.
"We will deliver this relief ... it will make a meaningful difference," he said, adding that state deals could be struck within weeks.
Dr Chalmers said there had been "important progress" on energy costs and housing at the meeting.
The RBA said electricity prices increased by seven per cent in the December quarter due to the unwinding of rebates in Western Australia and the ACT, though rebates in Queensland and Tasmania continued to ease prices.
Gas prices, which were not affected by government rebates, increased by about two per cent in the quarter to be more than 17 per cent higher over the year.
Deputy Liberal leader Sussan Ley said the government's plans for more spending, including via the National Reconstruction Fund, would drive up inflation and interest rates.
She was also sceptical about the promised power bill relief.
"I'd like to see Jim Chalmers remember the promise that his government made that life will be cheaper under me, and that matters for Australian households and businesses that are expecting cheaper electricity prices," she told reporters in Canberra.
"We've got no idea when it's coming."
The treasurers' meeting included a discussion on women's economic participation led by Finance Minister Katy Gallagher and, for the first time, a local government representative attended.
While the RBA's outlook for energy prices appeared positive, NAB analysts said interest rates appeared to be heading to a peak of 4.1 per cent, from the present 3.35 per cent.
They said the RBA statement suggested at least two more rate hikes in March and April and possibly another in May if inflation remained high.
The central bank upgraded its wage price index forecast, expecting it to peak about 4.25 per cent late in the year.
It also adjusted its inflation figure for mid-year from 6.25 per cent to 6.75 per cent.
