Key projections from the Reserve Bank of Australia in their latest SoMP:

  • unemployment 5% end 2021, 4.25% end 2022, 4% end 2023
  • GDP 4% end 2021, 4.25% end 2022, 2.5% end 2023
  • trimmed mean inflation 1.75% end 2021, 1.75% end 2022, 2.25% end 2023
  • wage growth 2.25% end 2021, 2.5% end 2022, 2.75% end 2023

The near term GDP forecast has been cut but boosted further out

  • -0.75% from the end 2021 forecast
  • +0.75% added to end-2022

The 'trimmed mean' is core inflation, RBA sees it above the lower bound of their target band (2 to 3%) in 2023 despite wage growth being under 3% for the same year.

Its best to take these RBA forecasts with a grain of salt - the Bank's forecasts are subject to a great deal of uncertainty, and even more so now with lockdown creating turmoil for economic growth. Its the back half of 2021 and we are still talking about lockdowns in Australia .... sheesh.

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