The RBA and its critics claim Australia’s economy needs to be slowed down. But the data shows both are wrong

‘Real wages are barely growing, household income is falling, household spending is flat,’ writes Greg Jericho. Photograph: Bloomberg/Getty Images

Right now, a key debate over the economy is between the Reserve Bank and the government over just how hot the economy is running. The RBA suggests there is “excess demand” while the treasurer argues the economy does not need any more slowing. The data is clear that the treasurer is correct.

This week the deputy governor of the Reserve Bank announced the RBA is feeling the heat. Andrew Hauser’s speech to the Economic Society of Australia titled “Beware False Prophets” was slightly less subtle than “Stop Picking on Us” but that basically was the gist.