RBA Governor Philip Lowe has today confirmed that the Australian economy was weak before the summer challenges of bushfires and the Coronavirus outbreak surfaced.
The Governor could not have been clearer when he said that “Looking back at last year, economic growth was weaker than we had expected”, and that “the most important factor is a domestic one”.
The Governor highlighted concerns about weak consumption driven by “a noticeable step down” in wages growth, a “troubling decline in productivity growth” and the downward trend in investment spending.
In the same week when members of the Morrison Government described action on climate change as a “hobby horse” issue, the RBA Governor noted that the economic impacts of bushfires and drought are “a stark reminder that the economic effects of these climate events are material”.
The Prime Minister and Treasurer’s inaction and incompetence have left the Reserve Bank to do all the heavy lifting.
Scott Morrison and Josh Frydenberg now want us to forget that the economy was deteriorating long before the bushfires or the Coronavirus outbreak.
Because of the Morrison Government’s economic failures, Australia meets the serious challenges and uncertainties of the fire season and the Coronavirus outbreak from a position of weakness, not strength.