The NAIRU is the lowest unemployment rate that can be sustained without causing wages growth and inflation to rise. It is a concept that helps us gauge how much ‘spare capacity’ there is in the economy.

This article describes how the Bank estimates one measure of spare capacity in the labour market – the gap between the unemployment rate and the non-accelerating inflation rate of unemployment (NAIRU). Model estimates of the NAIRU are highly uncertain and can change quite a bit as new data become available.

Spare capacity in the labour market is an important input into forecasts of inflation and wage growth. This article describes how the Bank estimates one measure of spare capacity in the labour market – the gap between the unemployment rate and the non-accelerating inflation rate of unemployment (NAIRU).

RBA considers NAIRU models with both variables and while the wage price index models produce an estimate that is slightly lower, around 4.5%, it is still well above the current unemployment rate. So regardless of the preferred wage measure, the case for interest rate cuts from the perspective of full employment in the RBA's mandate is not

The NAIRU is the point at which the unemployment rate is associated with stable wage inflation (defined in our models as wage inflation in line with productivity growth and inflation expectations). Inflation expectations in the Phillips curve are typically measured as the weighted average of

This article describes how the Bank estimates one measure of spare capacity in the labour market – the gap between the unemployment rate and the non-accelerating inflation rate of unemployment (NAIRU). Model estimates of the NAIRU are highly uncertain and can change quite a bit as new data become available.

2021年4月29日 · The Non-Accelerating Inflation Rate of Unemployment (NAIRU) is a variable of interest to policy makers as it provides an estimate of the degree of labour market slack in the economy. However, the NAIRU is unobservable, and must be estimated using statistical models.

Recent Estimates: As of 2021, the RBA estimated Australia's NAIRU to be around 4.5%, although with a wide range of uncertainty (roughly between 3.5% and 5.5%). Declining Trend: The downward trend in NAIRU estimates reflects structural changes in the Australian economy, including labour market reforms and increased labour market flexibility.

2023年8月30日 · The RBA believes in a mythical concept called the Non-Accelerating Inflation Rate of Unemployment, also known as the NAIRU. Despite there being little real-world evidence that the NAIRU even exists, it has been embraced by the RBA for decades.

2024年12月4日 · At the heart of the debate is what economists call the non-accelerating inflation rate of unemployment (NAIRU). The NAIRU is the lowest unemployment rate that can be sustained without causing...