Macroeconomic Variables in Australia

Macroeconomic Variables in Australia to Show How the Reserve Bank Sets Policies and Measures through Tools Such As the Cash Rate Movements

Executive Summary This paper analyses the trends of three key macroeconomic variables in Australia to show how the reserve bank sets policies and measures through tools such as the cash rate movements. In doing this analysis, the outline considers the past and current trends in each of the three variables, GDP, Inflation, and Unemployment, which further allows the writer to develop a forecast on each for the next six months. The forecast determines how the reserve bank of Australia sets the cash rate by relying on the existing analysis of the macroeconomic variables. The paper concludes that while the experts view the global market to be unstable, Australia is well poised to tackle its problems and position itself better. Introduction In the past, the Australian economy has been resilient managing to withstand all economic downturns such as the global recession in 2008 compared to other major economies. As a practice to respond to such downturns, the reserve bank of Australia conducts a proper analysis of its key economic variables such as GDP, Unemployment, and Inflation. In each of these aspects, the Reserve Bank of Australia may put in place measures that are based on what each of these macroeconomic variables indicates as the current market statistics. However, as new dynamics on aspects such as the global politics and economic measures come in to play, concerns arise on whether the reserve bank will retain the Australian economy advantage as it did before. This outline will review the Australians key economic variables to offer a forecast on how the reserve bank could alter the cash rate movements in a bid to maintain economic growth. Current Climate: Key Economic Variables In Australian Economy GDP Unemployment The current rate of unemployment stands at 5.6%. In comparison to other rates in the last few months, this rate is a decrease from the previous rate in the past three months, which stood at about 5.7%. According to Reserve Bank of Australia (2016a), unemployment in Australia increased by about 17,000 to give an overall figure of 725,000. The number of people who are employed in Australia also increased by about 39,100 to 11,973,200. This figure sums both the number of people who are employed full time who stand at about 8,166,200 and the part-time employees who are 3,807,000. The increase in the number of jobs equated to the level of employments shows an increase thus indicating a shift from 5.7% to 5.6%. Unfortunately, the increase has not had any significant improvement on wage, which stands at its lowest of 1.9%. The decrease in the level of unemployment rate indicates an improvement in the rate of workforce participation, which is one of the goals of the Australian Government. If You would Like us To give you a smilar paper alongside to the remaining section, Please Order with Us monetary policy, fiscal policy, monetary policy economics, monetary policy definition, types of monetary policy, monetary policy tools, macroeconomics study guide answers, macroeconomics questions and answers,

Macroeconomic Variables in Australia

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