Australian EconomyAustralian interest rates

Why the bedpan economy is an inflationary bust

David Llewellyn-Smith
Wednesday 27 August 2025
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Goldman with an important note.

We have previously argued Australia’s labour market is not inflationary because indicators that contain the most predictive power for wage growth have already normalised.

Nonetheless, the unemployment rate is historically low, boosted by employment in the healthcare & social assistance industry, and it is not obvious why this has not placed upward pressure on inflation.

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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.