The labour market will continue to provide an important guide as to which path we are on. It is, nevertheless, reasonable to expect an extended period of low interest rates in Australia. This reflects what is happening both overseas and here at home.
While we might wish it were otherwise, it is difficult to escape the fact that if global interest rates are low, they are going to be low here in Australia too. When the global appetite to save is elevated relative to the appetite to invest – as it is now – interest rates in all countries are affected.