Impact of the Global Economy: Increased Unemployment Rate in Australia. The Australian government expects the unemployment rate to rise after being at its lowest level in the last 48 years due to rising interest rates and a global economic slowdown. Currently, in the midst of high inflation, the unemployment rate in May 2023 is moving down to a level of 3.6 percent while economists predict it will stabilize at 3.7 percent.
Impact of the Global Economy. The Reserve Bank of Australia (RBA) previously stated that the unemployment rate would rise to a level of 4.5 percent. This figure is still below pre-pandemic levels.
Prior to attending a meeting of finance ministers and central bank governors of G20 member countries in India, Chalmers said the unemployment rate in Australia was expected to increase slightly, in line with the economic slowdown as a result of rising interest rates and global uncertainty.
The RBA this month decided to maintain its cash rate at its 11-year high of 4.10 percent. The central bank is known to have raised interest rates by 400 bps since May 2022 and expressed the possibility of further tightening. The decision was taken after June 2023 data from the Australian Bureau of Statistics reported that the Australian economy in the last quarter was at its slowest pace in 1.5 years.