Recent household finance data paints a picture of an economy less vibrant than the government would have us believe, though better than the doomsayers will admit -- and one the Reserve Bank will continue to fret about.
For the adults in the room at the RBA, high household debt and low wages growth remain the central domestic issues despite the bank's expectations of a gradual (its favoured word) improvement in wages growth. As governor Philip Lowe pointed out in yesterday's post-meeting statement, "one continuing source of uncertainty is the outlook for household consumption. Growth in household income remains low and debt levels are high. The drought has led to difficult conditions in parts of the farm sector."