RBA’s Hauser says there is a risk the unemployment rate could rise faster than assumed

Reserve Bank of Australia Deputy Governot Hauser, speaking at an Economic Society of Australia (QLD) event:

• Economic forecasts are subject to huge uncertainty.
• Assume inflation stickiness due to weaker supply, labour market tightness.
• But spare capacity could easily be much higher, or much lower than we assume.
• Assume unemployment will rise only slowly, but risk of faster increase.
• Assume household consumption to rise in line with real incomes.
• Risk consumption could rise more strongly, in part due to increase in wealth.
• Uncertain how far and fast savings rate might rise.

This article was written by Eamonn Sheridan at www.forexlive.com.