Wages still a worry for RBA on rates

(Australian Associated Press)


Weak wage growth remains a worry for the Reserve Bank and was a key factor in the decision to again keep official interest rates on hold this month, the latest RBA meeting notes show.

Minutes of the the central bank’s May meeting show the RBA board still believes any improvement in wages growth will be gradual – as will any flow-on to inflation, which remains at the low end of the preferred two to three per cent range.

While the RBA says there have been signs of employers finding it harder to source skilled workers, the bank noted “this had not yet translated into a material pick-up in wages growth” and said any future movement in rates will be higher but not for some time.


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