Part 2/5:
Despite these rate cuts, there are growing concerns about Australia's economic momentum. The RBA's latest assessment indicates that Australia's annual productivity growth has slowed to just 0.7%, down from the previous 1%. This decline underscores the challenges faced in boosting long-term economic resilience and competitiveness.
The RBA has revised its productivity assumptions downward, citing slower-than-expected growth, which adds pressure on policymakers to identify and implement structural reforms that can revitalize productivity levels. As Governor Michelle Bullock emphasized, while the economy is expected to recover eventually, the trajectory remains uncertain due to global economic volatility.