GDP growth was falling to its worst levels since 2001 and the second worst for 27 years, unemployment was rising and GDP per capita was actually going backwards. Consider that just after the budget the market was already anticipating a cut in interest rates. It is not when everyone has a job – it is when the unemployment rate is such that if it falls any lower inflation growth starts accelerating. The last time this happened was in 2007-08 at the end of the mining boom when the unemployment rate reached 4.2%:Given the current unemployment rate is 5.3% that suggests we have a long way to go – the equivalent of about 140,000 people currently unemployed getting a job. It means the RBA will have to cut rates further and in effect enter a period where either we have a negative cash rate or quantitative easing occurs.

Source: The Guardian October 02, 2019 18:00 UTC