RBA’s Lowe: Low probability of sudden revival in wages, inflation in Australia

Additional headlines crossing the wires from the RBA Governor Lowe, as he makes a scheduled speech on "The Labour Market and Monetary Policy" at the Anika Foundation Luncheon, in Sydney.

Main Points:

Not seeking to stimulate rapid increase in inflation as that carries financial stability risks

Stability of unemployment has "allowed us to be patient"

Central scenario remains for gradual rise in underlying inflation

Low probability of sudden revival in wages, inflation in Australia

Gradual lift in wages growth is central to inflation outlook

Labour market has performed well in recent times, on a number of measures

Sees welcome pick up in employment across country, likely to continue

But underemployment is elevated and job security has become an issue for more people

Growth in average hourly earnings slowest in many decades

Persistent weakness in wages has lowered expectations of future income growth

Impact on expectations is more than just temporary

Increased competition from globalisation, technology eroding job security

Also read: Australian Q2 CPI misses expectations, RBA trimmed mean in line