On June 20, Reserve Bank of Australia Vice Chairman Bullock said that for inflation to return to target, Australia’s unemployment rate needs to climb from the current 3.6% to around 4.5%, and economic growth “below trend.”
Our goal is to return the labor market (and the market for goods and services) to levels more consistent with full employment, the endpoint we project,” Bullock said in a speech Tuesday. “We believe that if employment and the economy more generally It is achievable to grow at a below-trend rate for a period of time.”
The Reserve Bank of Australia has raised interest rates by 4 percentage points since May 2022 in response to stubbornly high inflation, now near 7%, and has warned that further monetary tightening may be required.
Bullock reiterated that the central bank is “firm” on getting inflation back to target.