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" (McDonald, nd; 73) Inflation rates grew for two years while interest rates were rising and yet unemployment was lowering during this time. In the United States, it can be noted as well that while unemployment rates grew inflation rates fell. Monetary policy and inflation targeting are similar in the United States and Australia.
SUMMARY
Because employment rates do impact inflationary rates during times of change and in times specifically when unemployment rates rise it is necessary specifically during these times to inform the public through clear policy and expectations as to what is expected thereby cushioning the shock of the impacts of unemployment on inflation rates. There has however, been research reviewed in this study that shows that use of an inflation target is most useful to understand when lower of prices can result in a benefit to levels of employment.
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Australian Inflation Accelerates 1.3%
Published: 4/22/2008 8:03:15 PM
By: TradingEconomics.com, Bloomberg
http://www.tradingeconomics.com/Economics/Inflation-CPI.aspx?Symbol=AUD&File=04222008200315.htm
Labour Markets and Inflation - Domestic and International Developments OECD (199) OECD Economic Outlook, June 1990. Online available at http://findarticles.com/p/articles/mi_m4456/is_n47/ai_9301109
McDonald, Ian (nd) Discussion: The Debate on Alternative for Monetary Policy in Australia.
Trading Economics (2008) Australia's Economy. Online wwww. Tradingeconomics.com
Trading Economics (2008) United States' Economy. Online www.Tradingeconomics.com
Inflation, Economic Growth and Unemployment in Australia and the United States
Bibliography
Barro, R.J. And D.B. Gordon (1983), 'A Positive Theory of Monetary Policy in a Natural Rate
Model', Journal of Political Economy, 91(4), pp. 589-610.
Crosby, M. And N. Olekalns (1996), 'Inflation, Unemployment and the NAIRU in Australia',
Melbourne Institute Working Paper Series No. 7/97.
http://www.tradingeconomics.com/Economics/Inflation-CPI.aspx?Symbol=AUD&File=04222008200315.htm
Labour Markets and Inflation - Domestic and International Developments OECD (199) OECD Economic Outlook, June 1990. Online available at http://findarticles.com/p/articles/mi_m4456/is_n47/ai_9301109
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