Greg Jericho
Chief economist

What other things make the case for cutting rates pretty clear?

Well lets looks at household spending.

The most recent GDP figures showed that in the 12 months to September last year household consumption (which is everything we spend money on, from shopping to buying cars to paying bills) rose just 0.4% in real terms (ie taking out inflation).

Usually growth of 3.0% is considered a nice average increase.

So we are not buying a lot of stuff. And if you include population growth then the amount each household spent in the year to Sept 2023 actually fell 2%.

That ain’t good. And the amount we are buying “per person” is much lower than is was when the RBA began cutting rates, and roughly back where it was in 2019.

That is not the sign of a booming economy.