So far we have not gone into recession – but only because our population has grown and the government has kept spending
‘A month ago the governor of the Reserve Bank, Michele Bullock, when announcing she would keep interest rates on hold, said the board remained concerned about “excess demand”. She should be happy – the GDP figures show there is no demand.’‘A month ago the governor of the Reserve Bank, Michele Bullock, when announcing she would keep interest rates on hold, said the board remained concerned about “excess demand”. She should be happy – the GDP figures show there is no demand.
Well, she should be happy now because the latest GDP figures show there is no demand in the economy. Household spending fell in the June quarter and business investment barely did a thing.Again, she should be ecstatic because household spending on services fell 0.3% in the June quarter ., Dr Sarah Hunter, suggested to a Senate committee that “the economy is running a little bit hotter than we thought previously.
To make things worse, when we strip out population growth, GDP fell 1%. Out of the 65 financial years we have had since the Bureau of Statistics began calculating GDP, that is only the 10th time that has happened:When we look at the quarterly figures things are no better. Take out population growth and the economy shrank 0.4%. That makes it six consecutive quarters of falling GDP per capita.Depressed enough? OK, how about we note that the only reason the total economy rose a pathetic 0.
That increase has caused almost half of the drop in real household disposable income, which remains back where it was in 2014:The increase in rates would be somewhat palatable if we were at least seeing a nice increase in our earnings but instead the real compensation for employees is more or less flat:Add rising interest payments with earnings that barely keep up with inflation and it equals households not spending.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
RBA interest rates: Inflation could become entrenched, former RBA research boss John Simon warnsThe central bank’s former top researcher, John Simon, says the decision not to raise rates further has not been adequately scrutinised by the board.
Read more »
RBA interest rates: No rate cuts before Christmas, says RBA governor BullockMichele Bullock has declared “near-term interest rate cuts are not on the agenda”, warning the economy remained too hot and ruling out decreasing the cash rate before Christmas.
Read more »
Chalmer’s self interest is closer to the Australian people than the RBA’sIt’s easy enough to understand the treasurer’s criticism of the RBA in political terms. But the inflation target that is good for the central bank as an institution is not so good for the economy.
Read more »
RBA interest rates: employment jumps 58k in tight Australian jobs marketThe employment growth figures were better than market expectations for gains of 20,000 and highlighted the continuing resilience of the jobs market.
Read more »
Australian chef Maggie Beer in hospital after fall at South Australian homeIn a statement on social media on Sunday night, her family said she suffered minor bone fractures and related injuries.
Read more »
Paris Olympics: Australian hockey player arrested in Paris allegedly trying to buy cocaineAn Australian hockey player has been arrested in Paris, the Australian Olympic Committee has confirmed.
Read more »