Treasurer Jim Chalmers has promised to do all he can to ease cost-of-living pressures, but has warned inflation is "high and rising".
Dr Chalmers was sworn in on Monday after Labor secured at least a minority government at Saturday's federal election, and has been receiving briefings from Treasury officials in the past couple of days.
The treasurer says the idea that Labor is inheriting an economy that is performing well will be news to people copping the worst real wage rise cuts in more than 20 years.
"There is no use mincing words, this is a serious economic situation that we are inheriting from our predecessors," Dr Chalmers told ABC radio on Tuesday.
"What will change, you now have a government that understands these cost of living pressures and has a plan to deal with them over time."
This includes making child care, energy costs and medicines cheaper, while the treasurer reaffirmed that he wants to see the minimum wage rise in line with inflation when the Fair Work Commission makes its annual decision in coming weeks.
Dr Chalmers and incoming finance minister Katy Gallagher will be putting together and economic update for when parliament returns in June or July, followed by their first budget in October.
The Reserve Bank of Australia expects the inflation rate to hit six per cent at the end of the year, having already reached 5.1 per cent and the highest level in over two decades.
Despite growing cost pressures, the weekly ANZ-Roy Morgan consumer confidence index managed its first rise in a month.
The index - a pointer to future household spending - rose 1.7 per cent, a partial recovery after falling 7.7 per cent drop in the past four weeks and to its lowest level since August 2020.
However, at an index of 90.3 and below 100 it still indicates pessimists outweigh optimists.
ANZ head of Australian economics David Plank said the fall in the unemployment rate to 3.9 per cent, its lowest level since 1974, may have contributed to the lift in sentiment.
"Most of the survey was conducted before the federal election results were known, so the reaction to the election will be captured in next week's index," Mr Plank said.
Commonwealth Securities senior economist Ryan Felsman noted that while the survey's household inflation expectations index was steady 5.3 per cent, it remains elevated and reflects concerns over cost of living pressures.
In particularly, average petrol prices again rose sharply in the past week and sit just 13 cents per litre below the record highs seen In March.
This was despite the halving of fuel excise as part of an $8.6 billion cost-of-living assistance package in the coalition's March budget.
The Australian Institute of Petroleum in its weekly report says the national average price for petrol as of Sunday jumped by a further 14.1 cents to 199.1 cents a litre, the fifth consecutive weekly rise.
CommSec estimates it costs the average family $278.74 a month to fill up the car with petrol, an extra $57 a month compared with the start of the year.
