The Reserve Bank of Australia is optimistic about the future of the economy, despite conceding the pandemic downturn was the “worst contraction since the Great Depression”.
“Consumer spending in May and June had been stronger than expected and had also held up better than in most other countries,” the RBA said, in minutes released from the monthly monetary policy meeting.
“Nevertheless, the shock to the Australian economy would be the most severe since the 1930s.”
RBA Governor Philip Lowe said yesterday in an annual speech to the Anika Foundation: “All up, total hours worked in Australia fell by 10 per cent in just a few weeks”.
“As staggering as this fall is, it is smaller than we earlier feared. In early May, we were expecting a decline of almost 20 per cent in total hours worked.
“It is also a smaller than the decline we have seen in many other countries. In Canada, for example, hours fell by 28 per cent and in the United States they fell by 19 per cent.”
Governor Lowe also assured that, despite the debt accrued by our government for the JobKeeper, JobSeeker and various other rescue and stimulus packages, Australia remains in a healthy position.
“These are the lowest borrowing costs since Federation.”
