Australia Economic Recovery on the Rise!
Looks like Australia's economy is recovering very quickly.
The Organisation for Economic Co-operation and Development (OECD) recently released a report stating that Australia's economic recovery trend that began in the second half of 2020 will continue this year, and the rate of recovery will be faster than last year. The 3.2% forecast in December predicts that the economic growth of Australia as a whole will be 4.5% in 2021. Moreover, the economic growth rate in 2022 is exptected to be 3.1% , higher than the previous 2.8% forecast.
The OECD has given great affirmation to Australia's economic performance. In the post-covid era, Australia's economic recovery speed is leading globally. The Australian government has achieved remarkable results in controlling the spread of covid. At the same time, with vaccines rolling out, the government has also announced a number of active financial support.
Australian Federal Treasurer Josh Frydenberg said that the OECD reports credits the effort of the federal government. He particularly emphasized that Australia's economy has grown by more than 3% for two consecutive quarters, and our economic performance continues to lead the world's major economic developed countries (regions). In contrast, the countries that have been hit hard by the pandemic, the GDP of the United Kingdom, Italy, France, and Canda shrank by 9.9%, 8.9%, 8.2%, and 5.4%, respectively.
The Reserve Bank of Australia's (RBA) President Philip Lowe recently participated in the "Australian Financial Review" (AFR) business summit and once again made it clear that the current benchmark cash rate of 0.1% will be maintained until at least 2024.
In the past two weeks, there have been voices in the market saying that "RBA may rise interest rates within this year or nearly next year, but this time the RBA President's speech gave a very positive answer, "This is not our expectation! Until Australia's wage growth and unemployument rate return to expectations, interest rate hikes will not be considered."
Bloomberg's economists also made a clear interpretation of the RBA President's speech. Australia's low interest rate level will continue for a long time. The focus of the future will be on the labour market. Inflation will become an importat consideration for Austrlalia's monetary policy in the future.
The RBA President's report also mentioned the rising Australian real estate market. He said that the recent positive increase in the housing market has many factors, including low interest rates, strong demand from buyers, government stimulus measures, etc...,and further attention will be paid to the direction of the housing market in the future.
