Jeffrey Sheen - "keep an eye on inflation"
Publication: The Conversation
Title: Economic outlook weakens – but keep an eye on inflation
Date: 6 August, 2013
Author: Timo Henckel
Professor Jeffrey Sheen says we need "more time is needed to see what will happen to the real exchange rate".
"The June 2013 Australian labour force figures show a rise in the unemployment rate to 5.7%, but that was due to a rise in participation. CPI inflation remains benign. Business confidence in Australia is stronger in 2013 than 2012. The nominal trade‐ weighted exchange rate has depreciated 12.3% since March 2013, but the real trade‐weighted exchange rate has only depreciated by 2% so far – therefore more time is needed to see what will happen to the real exchange rate. Given these facts, my recommendations are unchanged from last month."