We should never forget that the economic growth data is ancient history. The Reserve Bank sets monetary policy by looking forward, not back.
And in terms of published economic data, we already have a number of figures for February available, so the December quarter is now a long way in the past.
Having said all that, the latest figures are disappointing. The Reserve Bank believes that economic growth is close to “trend” or “average”, but you would be hard pressed to see that in the data.
Economic growth averaged 3.0 per cent a year over the past decade and averaged 3.25 per cent over the past 15 years. But we haven’t hit 3.25 per cent for almost four years. In fact average growth was just 2.6 per cent over the past 5 years of the mining “boom”.
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