Australia’s Fair Work Commission has announced its decision on the minimum wage hike.
- will boost pay for around 180K Australian workers
- there will also be a 5.75% pay rise for workers on industry award rates, this will flow through to around another 2.7 million people.
The Commission said the decision was made in light of cost-of-living pressures being felt by Australia’s lowest-paid workers but would not have “discernable macroeconomic effects”
- “The current combination of economic circumstances, namely low unemployment, falling real wages and high inflation , is very unusual and presents a particular challenge in this year’s review,”
- “A further challenge is the expected sharp slowdown in economic growth over the next year.”
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The RBA is concerned to avoid a wage-price spiral . They’ll take this into consideration in next week’s decision.
- ANZ raise its forecast for the RBA terminal rate to 4.35% (from 4.10%)
- National Australia Bank expect a +25bp rate hike from the RBA, but not until August
The next Reserve Bank of Australia meeting is on June 6.
- statement is due at 2.30 pm Sydney time, which is 0430 GMT and 12.30am US Eastern time
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Current cash rate:
The rise in wages is well below the inflation rate.