Australia’s productivity riddle – and what it might mean for interest rates

The RBA governor, Michele Bullock, says productivity has been volatile since the pandemic but expects it back towards its trend level in the next year or so. Photograph: Tracey Nearmy/Reuters

If the Reserve Bank’s GDP forecasts about the Australian economy are right, we should be close to a nadir with a sustainable upswing on the way – provided we can get more efficient at what we do.

Productivity growth – a concept that quickens the pulse of economists and almost nobody else – has slowed in Australia and most other developed nations for years.