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Australia's Economy is Weak

Discussion in 'The Economy' started by Tropo, 22nd Oct, 2009.

  1. Tropo

    Tropo Well-Known Member

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    NSW
    The RBA should have waited until next year to move on rates, says Robert Mellor, managing director at BIS Shrapnel.
    He tells Matthew Kidman, portfolio manager at Wilson Asset Management and CNBC's Karen Tso that the Australian economy is quite weak.
    Video - CNBC.com
     
  2. Chris C

    Chris C Well-Known Member

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    Brisbane, QLD
    I don't think it would matter greatly when the RBA raised the cash rate, the economy was always going to be weak when it happened, and I'm imagining the recovery itself is also going to be weak regardless of what the RBA does because where going into it with massive amounts of debt so the growth is going to have predominently be genuine productivity and efficiency growth that drives the recovery while we also deleverage and probably see increases in unemployment.

    So at the end of the day I don't think perfect timing is critical at this stage given these low levels of interest rates, if anything it might have been prudent to send the message early to borrowers that cheap rates are not here for long.