Via the marvelous George Theranou of UBS:
Since the start of the year we expected GDP to drop, gradually raising unemployment, vs consensus & RBA still expect a flat/falling UR. This is the key driver of our dovish view of a peak in wages growth (also reflecting public sector wage caps). Importantly, the RBA just changed its wages view to “likely to remain low & to increase more gradually than earlier expected. As a result, inflation is likely to take longer to rise to 2%”.
There are 389 words left in this subscriber-only article.