A simple post today.
Policy makers in Australia have not done a good job managing the economy. The government’s tax and spending policies like a dog’s breakfast, achieving neither fiscal consolidation nor growth. The RBA has been distracted by Sydney and Melbourne house prices while the rest of the economy splutters and stutters.
Here are some basic facts.
At the time of the September 2013 election, Australia’s unemployment rate was 5.6 per cent and in the US, it was 7.3 per cent. That’s 1.7 percentage points in Australia’s favour.
Fast forward to the latest data and Australia’s unemployment rate is 0.3 percentage points higher than in September 2013 at 5.9 per cent, while in the US the unemployment rate has dropped a wonderful 2.8 percentage points to 4.5 per cent. It is now 1.4 percentage points in favour of the US.
And yet the US still has interest rates lower than in Australia. Wont be for much longer.