Economics
RBA Sees First Rate Hike in 2024 as Wage Growth Sluggish
- Central bank sees economy rebounding quickly from lockdowns
- RBA remains cautious on outlook for wage growth and inflation
Outside the Reserve Bank of Australia (RBA) building in Sydney.
Photographer: David Gray/BloombergThis article is for subscribers only.
The Reserve Bank of Australia struck an upbeat note on the economy, while maintaining that faster wages growth and inflation will take some time and the first interest-rate increase is unlikely before 2024.
The economy will expand 3% this year, despite a likely sharp contraction in the third quarter due to virus lockdowns, and then accelerate to 5.5% in 2022, the RBA said in its quarterly update of forecasts Friday. It sees wage growth of 3% and inflation at the 2.5% midpoint of the central bank’s target by end-2023.