THE LABOR government is crowing about its latest statistical achievements — low inflation, low unemployment, strong growth and booming investment.
So, why aren’t Australians feeling an overwhelming sense of warmth and well-being? Probably, as my earlier articles have explained … it all comes down to an overall lack of confidence.
Most people are still expecting the RBA to further reduce interest rates. However, barring a European meltdown, that would seem to be rather unlikely in the foreseeable future.
You only need to study these graphs to understand the RBA’s hesitancy — because clearly, the average measures of inflation currently sit at the bottom of the target band adopted by the Reserve Bank. [Read more…]