Reserve Bank of Australia

In 2019, the repurchase agreement (repo) market became the second largest onshore short-term wholesale funding market in Australia. In addition to its size, the range of participants and diversity of collateral used to obtain funds under repo has grown in recent years. As a result, the repo market provides valuable information about conditions in short-term wholesale funding markets. This article describes the recent growth in the Australian repo market and discusses the pricing in the repo market relative to other benchmarks. Read the Bulletin article: https://bit.ly/4bDzWTj

Housing loan arrears rates have increased from low levels since late 2022, with banks expecting them to rise a little further from here. Understanding what has been driving this increase is important for the RBA’s assessment of risks to financial stability and the economic outlook. We find that the main drivers have been challenging macroeconomic conditions and a modest ageing of the loan pool rather than risks specific to lending in a given year. Read the Bulletin article: https://bit.ly/3W26z79

The RBA’s Securitisation Dataset provides timely and detailed data on the individual mortgages underlying Australian residential mortgage-backed securities. It is one of the data sources used to assess financial stability risks arising from mortgage lending. This article discusses the usefulness of the dataset for complementing the RBA’s broader monitoring and assessment of risks from housing lending. Read the Bulletin article: https://bit.ly/3LqcCxq

Economics teachers from all over Australia headed back to class themselves last week to enrich their understanding of current economic issues and concepts. Our annual Teacher Immersion Event provides a unique professional development opportunity for secondary school economics teachers. This year they heard directly from our economists on topics such as the labour market, trends in inflation and how monetary policy is implemented. Teachers also had the chance to quiz RBA staff and network with their peers. To find out more visit: https://bit.ly/3SmMeZr #RBA #RBAEducationProgram #Economics

The strength in labour market conditions after the COVID-19 pandemic caused many people to enter the labour market or change jobs. This may have influenced productivity outcomes by affecting how well workers’ skills are matched to their new jobs. This article examines whether workers are better or less well matched to their jobs following the pandemic, and whether these skills matches may change in the future. Read the Bulletin article: https://bit.ly/46l8Jnr

The output gap – the difference between actual output and potential output – is an important consideration for monetary policy as it is a measure of the extent of spare capacity in the economy. This article explains how RBA staff form an assessment of potential output and the output gap. Read the Bulletin article: https://bit.ly/3Wkb0M5

The July 2024 Bulletin has been released. It features articles on: • Assessing Potential Output and the Output Gap in Australia • Skills Match Quality Following the COVID-19 Pandemic • How the RBA Uses the Securitisation Dataset to Assess Financial Stability Risks from Mortgage Lending • Recent Drivers of Housing Loan Arrears • The Australian Repo Market: A Short History and Recent Evolution Read the July issue: https://bit.ly/46l6AYV #RBA #Bulletin #Economy #Banking #MonetaryPolicy #Payments #FinancialStability

During NAIDOC Week, we organised a special event at our head office to connect employees directly to First Nations culture. Raymond Weatherall from the Metropolitan Local Aboriginal Land Council graced our balcony with traditional Smoking Ceremony, serving as an official ‘welcome to building’. This event provided our team with a unique opportunity to learn about First Nations cultures and histories, celebrating the oldest continuous living cultures on Earth. It’s part of our ongoing initiative to integrate First Nations practices, fostering a deeper understanding of First Nations culture within our organisation and opening up new opportunities for discovery. As for Smoking Ceremonies: ◾ They cleanse spaces of bad spirits. ◾ They can be performed on many levels – physical, mental, emotional, spiritual. ◾ These ancient ceremonies have been practiced for over 60,000 years and are profound. ◾ Many cultures worldwide also use smoke (such as sage, incense, various herbs and resins) to clear spaces. ◾ During the ceremony, Australian native plants were used. Join us in continuing to honour and learn from First Nations culture long after NAIDOC Week has passed. #NAIDOCWeek2024 #NAIDOCWeek #RBACareers

Some of the world's top high school economics students visited us for this year's Australasian Economics Olympiad (AAEO). The AAEO is a regional economics competition for high school students, with competitors from seven countries including Australia, Singapore and China. During their visit, the students had the opportunity to hear from Chief Economist Sarah Hunter and a panel of economists to learn about our role and what a career in economics can look like. Our public education program offers a range of talks to high school students throughout the year. Teachers can request a talk for their classes by contacting us via our website at https://bit.ly/4bwIoUc #RBA #RBACareers #RBAEducationProgram #Economics

It is said that the future is uncertain – but so is the present. Policymakers need to know what’s happening in the economy right now but often the information they have is outdated or provided with a lag. This need for timely information was most acute during the COVID-19 crisis when conditions were rapidly evolving, forcing policymakers to make decisions under significant uncertainty. Policymakers are further hamstrung because the most detailed measure of economy activity – gross domestic product (GDP) – is published with a long lag, limiting its value as a measure of the current state of the economy. Our researchers Luke Hartigan and Tom Rosewall developed a monthly activity indicator for Australia to help close this information gap. Read the paper to learn more: https://bit.ly/3zx9Bc6 Want to get to know our researchers? Check out our Researcher Profiles: https://bit.ly/3zwg7Ql