Australia is now beginning a modest recovery from the very soft growth in household incomes that occurred from 2012 to 2016. This recovery in household incomes is a result of improved commodity prices. These higher household incomes should support a steady path of consumption over the medium-term. Whilst consumption is not expected to return to the golden period, it is expected that rising household income will continue to support steady growth.
Furthermore it is not expected a rise in the RBA’s cash rate until at least the second-half of 2020, which should also provide support for growth over the medium-term.
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