Supply Shocks on the Rise: A Challenge for Global Macroeconomics
The Reserve Bank governor warned about the rise in supply shocks and their impact on the Australian economy, seeing productivity improvement as an important challenge for the coming years. The economic landscape has become more volatile, with significant impacts felt in financial markets due to each new shock.
Recent volatility in oil markets highlights a broader phenomenon of greater supply shock susceptibility, as warned by the Reserve Bank governor. The global landscape is becoming less predictable and more volatile, with economic impacts from these variations being felt in financial markets with each new shock. For the Reserve Bank of Australia (RBA), such movements may challenge its ability to apply effective monetary policy. The focus on improving productivity, identified as a key challenge for Australian economic growth over the next years, fits perfectly into this new reality of more vulnerable economies to external disruptions. Productivity serves as a barrier against inflation and volatile oil markets, strengthening Australia's resilience in the face of these global challenges. Source original: ABC Australia Business
Source: ABC Australia Business