Opinion

Opinion: The worst possible time to reduce stimulus in Australia

By Adam Triggs
Updated July 1 2021 - 6:02pm, first published August 3 2020 - 2:00pm
Treasurer Josh Frydenberg. Picture: Elesa Kurtz

Since the COVID-19 crisis began, economic stimulus has come from four main sources: fiscal stimulus from federal and state governments, monetary stimulus from the Reserve Bank, a depreciated exchange rate, and loan deferrals from commercial banks. In an unfortunate turn of events, all four sources have been reduced in recent weeks, with the other form of stimulus - supply-side reform - nowhere in sight. This is despite a state of emergency, a state of disaster and a curfew in Victoria, and rapidly increasing unemployment. The Australian economy is being left dangerously exposed.

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