Australian interest rates Featured Article

No, Bloomie, Australia is not Sweden

Thursday 2 June 2016

Australia’s fastest economic growth in four years is unlikely to dissuade policy makers from cutting interest rates to fan inflation: Just look at Sweden.

The Nordic nation grew an annual 4.2 per cent in the first quarter while running negative rates and a bond-buying program to revive inflation that’s failed to reach its target for half a decade. ABS data on Wednesday showed Australia’s economy grew at a rate of 3.1 per cent from a year earlier, yet the Reserve Bank of Australia cut rateslast month after inflation fell below its target range and is likely to stay there for the remainder of 2016.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.