Tweet
THE days of historically low interest rates could soon be over as a rebound in the economy restrains the Reserve Bank's use of the monetary scalpel.
Minutes from the central bank's July meeting, due out today, are expected to talk up the Australian economy's resilience in the face of global financial instability.
With interest rates at a 49-year low, and middle-income earners benefiting from recent federal government stimulus programs, inflation may return to the headlines during the coming year.
An Access Economics business outlook report says interest rates will be raised again in 2010 and 2011.
Access Economics director Chris Richardson said that while the Reserve Bank may cut interest rates one more time to help banks cope with borrowing costs, a less dire than expected set of unemployment numbers next year may herald the start of a recovery.
The Government expects unemployment to peak at 8.5 per cent during the next financial year.
Mr Richardson, however, said the jobless rate could hit a ceiling of 7.5 per cent in 2010, up from 5.8 per cent at present.
Government hits back at estimates
Despite this estimate, Treasurer Wayne Swan said this morning that the Federal Government will not revise its unemployment forecast.
"The Government will not be revising the forecast until ... MYEFO," Mr Swan told ABC Radio today, referring to the Mid-Year Economic and Fiscal Outlook, due out at the end of the year.
Mr Swan said investment in infrastructure would help boost the economy, and ruled out a third wave of cash payments being called for by trade unions.
"The Government is not contemplating another round of cash payments," he said.
Read more ...
Jenny
Minutes from the central bank's July meeting, due out today, are expected to talk up the Australian economy's resilience in the face of global financial instability.
With interest rates at a 49-year low, and middle-income earners benefiting from recent federal government stimulus programs, inflation may return to the headlines during the coming year.
An Access Economics business outlook report says interest rates will be raised again in 2010 and 2011.
Access Economics director Chris Richardson said that while the Reserve Bank may cut interest rates one more time to help banks cope with borrowing costs, a less dire than expected set of unemployment numbers next year may herald the start of a recovery.
The Government expects unemployment to peak at 8.5 per cent during the next financial year.
Mr Richardson, however, said the jobless rate could hit a ceiling of 7.5 per cent in 2010, up from 5.8 per cent at present.
Government hits back at estimates
Despite this estimate, Treasurer Wayne Swan said this morning that the Federal Government will not revise its unemployment forecast.
"The Government will not be revising the forecast until ... MYEFO," Mr Swan told ABC Radio today, referring to the Mid-Year Economic and Fiscal Outlook, due out at the end of the year.
Mr Swan said investment in infrastructure would help boost the economy, and ruled out a third wave of cash payments being called for by trade unions.
"The Government is not contemplating another round of cash payments," he said.
Read more ...
Jenny
Comment