Soaring gas prices are among the "serious economic challenges" facing the Australian economy, Treasurer Jim Chalmers has said, in a blunt warning that cost of living pressures won't ease in the coming months.
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Dr Chalmers has left the door open to Labor launching a drastic intervention into the domestic gas market as price shocks hit households and businesses.
The new Treasurer made the comments after the release of figures showing the economy had weathered the Omicron wave and east coast flood crisis to grow 0.8 per cent in the March quarter.
Growth was at 3.3 per cent in the 12 months to March.
Dr Chalmers said while there were pleasing elements in the latest numbers, including strong demand and a tight labor market, growth in March was lower than what had been forecast in the Coalition's pre-election budget.
The new Treasurer said there was "no point mincing words" about the challenges Labor had inherited from the Morrison government, including soaring inflation and further interest rate hikes on the horizon.
The Albanese government is also being forced to grapple with skyrocketing energy prices, which has put pressure on households and businesses.
Dr Chalmers said there were no quick fixes to a problem which he claimed was caused by the Coalition's failure to provide energy policy certainty during its near decade in power.
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One option open to the government is to pull the trigger on the so-called Australian Domestic Gas Security Mechanism, which can be used to force companies to limit exports to shore up domestic supply.
Dr Chalmers was asked multiple times about the controversial step during Wednesday's press conference.
The Treasurer didn't want to pre-empt conversations he would have with his energy and resources ministers by speculating on whether Labor might consider the intervention.
"I'm just trying to be very careful not to pre-empt conversation that might happen from here," he said.
"The spike in the gas price is a serious challenge to our economy. It requires careful monitoring by all of our regulators and proper consultation and collaboration about all of our options, and that's what we intend to engage in."
Cost of living pressures for households in NSW, SA and the south-eastern part of Queensland are set to worsen next month as surging wholesale costs push up household bills.
One retailer, ReAmped Energy, has taken the unusual step of encouraging customers to find another retailer before prices double after July 1.
Deputy Prime Minister Richard Marles earlier on Wednesday said the new government wasn't "pretending that there is an immediate answer" to the energy price shock.
Dan Jervis-Bardy
Dan covers federal politics from Parliament House, with a special focus on climate policy and the NDIS. He has previously reported on ACT politics and urban affairs since joining the Canberra Times in 2018.
Dan covers federal politics from Parliament House, with a special focus on climate policy and the NDIS. He has previously reported on ACT politics and urban affairs since joining the Canberra Times in 2018.
