Hearing it from the source
Having discussed the theories of economics for a couple of years, two Year 12 Economics classes were very impressed to hear how these principles are applied from an insider: an RBA analyst who visited last week.
Dr Alex Heath, Head of the Reserve Bank’s Economic Analysis Department (and a Wenona mum) expanded the girls’ knowledge by covering topics about to be examined in the HSC and how these theories work in the national economy.
Dr Heath covered the dynamics of inflation, household consumption and income, business investment, commodity prices, the labour market, and reasons for the Aussie dollar’s recent appreciation against the greenback. Katie asked an insightful question about how the two main tools of macroeconomics, the RBA’s low cash rate and the government’s current approach of fiscal consolidation, work together - or not. The diplomatic answer from the RBA was that Monetary policy is the main tool to influence the level of demand in the economy in the short term.