Peter Martin, Crawford School of Public Policy, Australian National University
Why raise rates now, for the first time in more than a decade? If the Reserve Bank isn’t careful, too many more rate hikes like this might help bring on a recession.
Peter Martin, Crawford School of Public Policy, Australian National University
While everyone’s talking about Anthony Albanese’s campaign stumble, the more extraordinary thing is that unemployment is actually set to fall below 4%. A 60-year low of 3% is now within sight.
Do you have what it takes to be Australia’s number two central banker and heir apparent to the governor? Here are the questions you’ll need to prepare to answer.
Peter Martin, Crawford School of Public Policy, Australian National University
Unemployment is far lower than predicted and isn’t setting off the kind of inflation seen in the United States. There’s no telling how much lower it can go.
There’s no reason why Australian lenders couldn’t offer 30-year fixed-rate mortgages, as they do in the US. It could save borrowers thousands of dollars in interest a year.
Brainard has been pushing the Fed to consider exposure to climate change in its regulation and analysis of banks. That’s sparked fury from Republican senators – and even a Nobel Prize winner.
Peter Martin, Crawford School of Public Policy, Australian National University
Outside of a few superstar firms investing heavily in artificial intelligence, investment by Australian businesses has been shrinking for a decade and isn’t set to bounce back.
Peter Martin, Crawford School of Public Policy, Australian National University
The 55 leading economists surveyed by the Economic Society see few signs of Australia aping the US, where inflation has surged to its highest level in 30 years.
Sub-2% mortgages are a thing of the past. The Reserve Bank’s governor has signalled variable rates will rise sooner than previously expected, but says he doesn’t expect it in 2022.
The Reserve Bank’s Term Funding Facility was meant to support lending during COVID. Instead the funds might be ending up in the accounts of bank shareholders.
Australia faces economic problems down the road if three big, structural reform areas — housing affordability, the tax mix, and decarbonisation — are not addressed.