RBA Noted Improvement of Labor Market And Economic Growth
The RBA minutes for the July meeting showed that politicians recognize economic growth and improvement of the labor market.
The greatest attention is paid to the discussion of the neutral rate, at which production growth is in potential, and inflation is stable. Politicians noted that, this indicator was generally stable until 2007, but has fallen since then by about 150 basis points to 1%. The neutral rate, in their opinion, should be + 3.5%.
The central bank also noted that the improvement in the world economy over the previous months is also positive for further development. As for the Australian data, the RBA noted that the economic data for the second quarter were generally positive.