Inflation. We've all heard the term tossed around as the cause of higher interest rates, especially when our wallets feel a tad lighter than they used to. But what's causing the rising cost of essentials like housing and food in our sunburnt country? According to reports this week, the primary culprits are immigration and a few bizarre policy hiccups.

One standout policy that's copped some flak is Queensland's cashback offer on 'energy efficient goods'. At first glance, it might seem like a good idea, right? Save energy, get cash back – sounds sweet. But little policies like the energy efficiency cash-back offer from Queensland can have major national repercussions. In this case, economists are blaming it for higher interest rates.

At the time the Premier announced the policy, the feeling was that something just didn’t sit right. A glance at her social media showed most people were livid that either a) they weren’t just given cheaper electricity or b) only those who could afford the full cost of a white good up front could then claim back part of that cost – meaning it was a policy for the wealthy only.

It turns out that the big picture suggests that such incentives can push up prices elsewhere as Queensland sucks up demand for white goods. This week, it has been revealed that the ill-conceived cash-back policy will contribute to higher interest rates.

But it doesn’t stop there. The International Monetary Fund (IMF) has raised a red flag about how higher immigration levels are adding fuel to the inflation fire. Their take? With more folks moving to our shores and boosting demand, prices of essential goods and services are bound to rise. And what's their solution? The IMF suggests our Reserve Bank of Australia (RBA) might have to lift interest rates in response.

Higher interest rates and more pain for Aussies because at one end we have state governments fueling demand, affordable only because of the state’s grotesquely high taxes, and at the other a federal government supplying the country with more buyers in the form of record-high immigration. Labor can never be trusted to run an economy, let alone a country.