Economics is an occupation with no shortage of data. One piece of data economists watch is the participation rate (the number of people who either have a job, or are looking for one). Economists watch this data for both demand and supply reasons.
With the Reserve Bank of Australia cutting the official cash rate to a record low of 1 per cent, interest rates continue to be the talk of the business pages. But do rates this low pack a monetary punch? Or will the Government have to pull on the fiscal purse strings to get the economy moving, as RBA Governor Philip Lowe is encouraging?
The big picture So, where to from here? The economy is probably in better shape than the GDP numbers indicate, but government, business and the RBA will need to switch gears to get wages growth and inflation up. Most economists agree that that may have to happen in the form of a few more interest rate cuts. It is not a matter of if, but when. The big picture ...
If the headlines are to be believed then the Australian economy is about to hit some headwinds. In January we’re seeing more weak numbers: house prices are down, equity markets are volatile, retail foot traffic is falling, the Aussie dollar is under pressure and residential building approvals are in free fall. With the September quarter 0.1% drop in GDP and the weakness looking set to continue well into 2019, economists are wondering: Has Australia fallen into recession?
Was the recent federal budget all bark but no bite? The Australian economy remains in 'steady as she goes' mode and it was clear that, some election sweeteners aside, the budget wasn't going to make any radical changes or funding promises.