Strong economic growth averaging 3.5 percent is what the Australian economy can look forward to over the next two years, according to the Reserve Bank, bringing the jobless rate to 4.75 per cent by 2020. This is despite the current doom and gloom surrounding forecasts for the real-estate market.
The decision to leave the interest rate on hold, however, is partially due to the RBA waiting for indications of a lift in wages and inflation, which has remained stagnant over past years. Other areas of concern, mentioned by the RBA governor are household consumption which remain low and high levels of debt.
The positive economic forecasts, however, is a good indication of the overall health of the economy with the key expectation being that it will lead to jobs and wages growth resulting in an overall increase in economic activity.