Looking Beyond the Wage Price Index

Looking Beyond the Wage Price Index

A review of the RBI board meeting minutes from February 15th revealed that the RBA is treading cautiously, in part due to uncertainty over the future trajectory of wage growth.

period at the parliamentary testimony on February 11th, a small insight into the current thinking at the arbour RBA was revealed, that the RBR RBI is making a conscious effort to look at data beyond the standard wage price index, such as metrics for overtime payments and bonuses. The data suggests that the lag time for updates in these metrics following changes in the economy “ on the ground” Is shorter than for the wage price index, meaning that new information is reflected more quickly in these metrics. Hence, movements in overtime payments and bonuses can be a valuable early indicator of things to come and may foreshadow changes in the WPI which cannot yet be observed.

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