RBA Rate Brake Stuck Between Wage Growth and the Slowing Housing Market

Feb 6, 2018

With poor wage growth comes less household revenue and declining savings, all factors of concern for the RBA. Thus, they have their foot firmly on the rated brake this month, until they have greater economic certainty.

What’s the deal? In late 2017, Australian wage growth remained to stagnate even though employment rose, along with the minimum wage. But, despite this, wage growth has been lower since the end of the mining boom. This decline coupled with a slowing property market, which is expected to fall even further, may result in a decline in household consumption. As a result, economic growth will dwindle.

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