Addressing the Anika Foundation on Tuesday, Reserve Bank (RBA) Governor Phillip Lowe said even despite signs of recovery, the path forward for the labour market was uncertain. 

"This is because many of the people who lost their jobs over recent times have been classified as not in the labour force and so are not counted as unemployed," Dr Lowe said.

"As the labour market continues to improve, we expect many of these people will start looking for jobs, and thus be classified as rejoining the labour force.

"This will push up the measured unemployment rate at the same time that the share of the working-age population with a job is also rising." 

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Provider

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  • Bonus rate for the first 4 months from account opening
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010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
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  • Deposit at least $1,000 + each month from an external source
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  • No account fees
  • Total ongoing variable rate of up to 5.20% pa by depositing $1,000 in the previous month
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Saver Account (<$250k)

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  • Easy access to your money
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  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking
  • A great base interest rate of 4.75%

Savings Account (Amounts < $250k)

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  • A great base interest rate of 4.75%
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Home Saver

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No monthly fees
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  • Deposit $200 per month to activate bonus interest
No monthly fees

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  • Deposit $200 per month to activate bonus interest
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HomeME Savings Account ($0 - $100,000)

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        For customers aged 14-35 years
        For customers aged 14-35 years

        Future Saver Account ( < $50k)

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          • Maximum Age - 24
          • $0 monthly account fee
          • Earn bonus interest

          Goal Saver

          • Maximum Age - 24
          • $0 monthly account fee
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            Reward Saver Account (31 years +) ($0-$100k)

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              Bonus Saver Account (Amounts < $100k)

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                Reward Saver Kick Start (Amounts ≤ $1m)

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                          Save up

                            Important Information and Comparison Rate Warning

                            All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of December 8, 2023. View disclaimer.

                            Dr Lowe said until scientific breakthroughs were made or we become better at managing the virus, incomes would be temporarily lower.

                            He also said although the figures in April and May - which showed employment fall by around 870,000 people - were staggering, Australia had now turned the corner. 

                            "In June, hours worked increased by 4% and the number of employed people rose by 210,000," he said.

                            "Notwithstanding this turnaround, the path ahead is expected to be bumpy and there are some major cross-currents in the labour market at the moment."

                            Prime Minister Scott Morrison today announced a tapered extension to JobKeeper and JobSeeker, and Dr Lowe said both schemes were vital for recovery. 

                            "By helping the economy today, these measures also support the all-important confidence that I spoke about earlier," he said.

                            "So they assist with a return to more normal patterns of spending and consumption, without the need for ongoing fiscal stimulus." 

                            Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner-occupiers.

                            Lender

                            VariableMore details
                            Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase
                            • Immediate cashback upon settlement
                            • $2000 for loans up to $700,000
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                            • $2000 for loans up to $700,000
                            • $4000 for loans over $700,000
                            VariableMore details
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                            • Unlimited redraws & additional repayments. LVR <80%
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                            • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
                            VariableMore details
                            • Up is 100% owned by Bendigo Bank.
                            • Up to 50 offset accounts
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                            Up – Up Home Variable (Principal & Interest) (LVR ≤ 90)

                            • Up is 100% owned by Bendigo Bank.
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                            • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)
                            Important Information and Comparison Rate Warning

                            Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of December 8, 2023. View disclaimer.

                            "There's no free lunch" 

                            Dr Lowe also used his address to rule out the possibility of Modern Monetary Theory (MMT), whereby the RBA deposits money in every bank account in Australia, also known as helicopter money. 

                            The RBA has the ability to create money and avoid financial constraints, offering a free lunch of sorts. 

                            "So the argument goes, if the government needs money to stimulate the economy, the central bank should simply create it in the public interest," Dr Lowe said.

                            "The reality, though, is there is no free lunch. The tab always has to be paid and it is paid out of taxes and government revenues in one form or another."

                            Dr Lowe said helicopter money could push inflation up too drastically, so the central bank would have to hike the cash rate, meaning the general population would end up funding the system. 

                            "So I want to make it very clear that monetary financing of fiscal policy is not an option under consideration in Australia, nor does it need to be," he said. 

                            "The Australian Government is able to finance itself in the bond market, and it can do so on very favourable terms."

                            Dr Lowe reaffirmed the Board had no appetite for negative interest rates in Australia, as it would encourage people to save more, rather than spend more, which is not the direction we needed to head in.