The Reserve Bank is expected to forecast the national jobless rate to fall below 4 per cent for the first time since the early-1970s later this week.
The Reserve Bank could forecast the national jobless rate to fall below 4 per cent when it updates its official outlook this week – the lowest rate since 1974.
“When you have had growth in employment of 365,000 in one month, and 65,000 in the next, as happened at the end of 2021, usually there is more to come,” Professor Borland said. “In this case, a major reason for thinking there is more to come is the current high level of job vacancies.” The RBA board will meet for the first time in 2022 on Tuesday. The board is widely expected to end its $350 billion bond-buying program, ahead of the next interest rate hiking cycle.
“However, gradually rising wages/rents should keep [underlying] inflation in the top half of the RBA’s 2-3 per cent target band through to mid-2023,” he said, adding he also expected wages growth to hit 3.2 per cent by year’s end.That will be an important trigger point for the central bank to hike rates.
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