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A ‘soft landing’ is finally on the horizon for Australia's economy

Piloting the nation out of financial turbulence is difficult. But the RBA looks like it might achieve one of the trickiest economic manoeuvres: a soft landing.

Jennifer Duke
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Former governor Philip Lowe told us last year the path to a soft landing was a narrow one. The RBA under Michele Bullock might just be able to pull it off. AAP Image/Lukas Coch.

At the first Reserve Bank board meeting of 2023, the flight path could not have been less certain. Then-governor Philip Lowe had just increased rates by 25 basis points as inflation continued to surge. And he issued a warning that the path to economic safety the RBA was attempting to navigate was an especially “narrow one”.

Now, just weeks away from the first RBA monetary policy meeting of 2024, some economists think a soft landing is not only possible — but likely.

Commonwealth Bank head of Australian economics Gareth Aird is optimistic about the chances of a gentle end to the inflation crisis.

“We can [get a soft landing]. The unemployment rate is still pretty low. Economic growth is slowing but the good news is the rate of inflation is coming down as well,” Aird tells Capital Brief.