Latest wages data makes a mockery of rate increase predictions

By:

Wages growth remains subdued which adds further to the likelihood that interest rates will not increase until 2024 at the very earliest, as predicted by the RBA.

The ABS reports that the Wage Index increased by just 0.4% over the June quarter which was well below the 0.6% reported over the previous two quarters.

Chart1

Wages

Although annual wages growth has increased by 1.7% over the year ending the June quarter and is higher than the 1.5% reported over the March quarter, the result reflects the record low lockdown-influenced levels recorded over June and September last year.

Low and falling wages growth was recorded over the June quarter despite the lowest unemployment rate for 10 years, strong jobs growth, and a collapse in international migration providing dramatically less competition for available jobs.

Although current lockdowns will act to reduce labour market activity and impede wages growth, chronically low wages growth over the past decade ensures interest rates are going nowhere for a long-time.

Particularly with the prospect of real wages falling as inflation rises.

icon-podcast-large

Subscribe & don’t miss a single episode of Michael Yardney’s podcast

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

Need help listening to Michael Yardney’s podcast from your phone or tablet?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.

icon-email-large

Prefer to subscribe via email?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.


About

Dr Andrew Wilson, Chief Economist of www.MyHousingMarket.com.au is widely regarded as Australia’s leading property economist.


'Latest wages data makes a mockery of rate increase predictions' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.
CAPTCHA Image

*


Copyright © Michael Yardney’s Property Investment Update Important Information
Content Marketing by GridConcepts