Inflation has many guisies, the RBA tends to favour the CPI but, this ommits many factors that the average person is exposed to everyday. Probably, the main concern is what inflation would do to interest rates, if inflation increases with mortgages alreay stretched raising interest rates would likely create a negative fedback loop with defaults proportions the the extent of the rise. I beleive in Denmark the response has been to introduce 10 year fixed rate mortgages at 0.00% interest. Not great for the banks but, better than a default and loose money which, once defualts commence the real estate values follow and loss of equity.
