ECONOMIC CHANGES DURING THE ELECTION CAMPAIGN:
INFLATION – Fee-of-residing pressures had been constantly going to be a considerable section of the selling and marketing campaign, even extra so after the most up-to-date figures confirmed inflation spiked to 5.1 per cent, the best stage in better than 20 years and effectively above expectations. The Reserve Bank of Australia expects inflation to attain 5.5 per cent by June – in comparison with the authorities’s 4.25 per cent forecast – and 6 per cent by the discontinue of 2022. While the March funds equipped an $8.6 billion abet kit, which included halving gas excise, petrol costs are on the upward thrust again because of the stubbornly excessive world oil costs sparked by the war in Ukraine.
INTEREST RATES – Though it gave the impression no longer going the RBA would raise the money rate for the principle time in better than a decade during the selling and marketing campaign, the central bank may perchance perhaps no longer ignore the unexpected jump in inflation. The money rate rose to 0.35 per cent from a file low 0.1 per cent, the build it had stood since November 2020 and during the depths of the pandemic. Economists inquire of a like a flash upward thrust within the money rate in coming months, including hundreds of greenbacks to mortgage repayments. The final be conscious time rates of interest increased during a marketing and marketing campaign, in 2007, then-Liberal high minister John Howard misplaced the election.
WAGES GROWTH – The lacking link within the economy’s recovery from the 2020 recession stays a considerable boost in wages boost. As of the March quarter the considerable wage tag index used to be operating at an annual rate of two.4 per cent, effectively horrified of the rate of inflation, which manner wages are going backwards. The RBA does no longer inquire of wages to outpace inflation till the discontinue of 2023.
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CONFIDENCE – Consumer self belief has unsurprisingly been sunk in step with rising tag-of-residing pressures, dilapidated wage boost and rates of interest on the develop – a injurious omen for future household spending and a key part for economic boost. A modest self belief fetch-up in step with the tag-of-residing abet within the March funds proved brief lived. The weekly ANZ-Roy Morgan consumer self belief index has dropped for four weeks in a row and to its lowest stage since mid-August 2020.
LABOUR MARKET – The jobs recovery has been the stand-out characteristic of Australia’s rebound from recession. After hitting a 22-365 days excessive of seven.4 per cent during the steep economic downturn in mid-2020, the unemployment rate has fallen to some.9 per cent, the lowest stage since 1974. The RBA expects the jobless rate to tumble to some.5 per cent by the middle of 2023. On the different hand, employment boost is slowing irrespective of file inquire for group of workers, with fewer folks now out there to maintain positions, partly because of the the lack of expert migration thanks to closed world borders during the pandemic.
ECONOMIC GROWTH – The Morrison authorities can peaceful at this stage boast an economy that has recovered in leaps and bounds from the 2020 recession, irrespective of turning exact into a excessive inflation and rising rate of interest environment. The latest national accounts did display veil the economy stands 3.4 per cent higher than sooner than the COVID-19 pandemic. The IMF also upgraded its boost forecast for Australia to 4.2 per cent for 2022 from 4.1 per cent previously, whereas slashing its world boost prediction to some.6 per cent from 4.4 per cent. The March quarter national accounts are no longer due till June 1.