Previous RBA research has found a significant relationship between investment and variables such as the user cost of capital, cash flow, sales, business confidence and the terms of trade: La Cava G (2005), ‘Financial Constraints, the User Cost of Capital and Corporate Investment in Australia’, RBA Research Discussion Paper No 2005–12 and Cockerell L and S Pennings (2007), ‘Private Business Investment in Australia’, RBA Research Discussion Paper No 2007–09.
In this regard, the CBK moved decisively in the second half of 2015 to deal with 1  rising inflation expectations largely due to increases in food prices, and pressures in the foreign exchange market reflecting developments in the global financial markets. As a result, overall inflation declined to stand at 6.7 percent in November 2016 from 8.0 percent in December 2015.