That implies that the effect of monetary policy on the exchange rate has been broadly working as usual. As I mentioned before, there has been a noticeable decline in Australian interest rates relative to those of major advanced economies. At a two-year horizon, this interest rate differential has declined by about 100 basis points over the past year.
The Quarterly Employment Survey recorded 10.57 million formal jobs at the end of 2019, against 9.98 million 7  now.9 Were all those workers unproductive, so that recovering those roughly half-amillion jobs would add nothing to output? Are all sectors in the economy at full capacity? Can potential realistically be at zero? These competing views are not wholly incompatible. They both capture important truths.