New Zealand’s history of inflation, recessions and unemployment offer clues to what might happen next. Coupled with global events, the outlook is not promising.
With voter confidence already low, the National-led coalition will have difficulty fulfilling pre-election promises while delivering a prudent budget in May.
Peter Martin, Crawford School of Public Policy, Australian National University
The best measure of living standards – real household disposable income per capita – has been going backwards for two years. It’s the biggest dive in living standards in half a century.
The real question in the minds of many economists is what the trend in inflation will be going forward, and when interest rates will begin to fall and bring relief to Canadians.
Beneath the obvious policy differences between Labour and National lies a tacit consensus on fundamental economic settings. Until that changes, political choice will be constrained.
Why is monetary policy outside the realm of politics? What are the social ramifications of our current monetary policy system? What alternatives exist?
Six charts explain the Australian economy. Three of the most disturbing show living standards going backwards, productivity collapsing and household saving falling to a 15-year low.
Peter Martin, Crawford School of Public Policy, Australian National University
Even a week ago we couldn’t have predicted this. But after good news from the US, our Reserve Bank now has a chance to cement low unemployment while controlling inflation – without more rate rises.
Peter Martin, Crawford School of Public Policy, Australian National University
The good news includes a return to real wage growth and a restrained increase in unemployment. The bad news includes even higher home prices and a per-capita recession.