The Conversation

To fix confidence this budget will need to contain stimulus

Author: The Conversation

Treasurer Joe Hockey may have welcomed this month's interest rate cut, but it's now up to the government to boost confidence.Lukas Coch/AAP

The decision of the Reserve Bank of Australia (RBA) to lower the cash rate to 2% this month is good economics.

The output gap (i.e. the difference between actual GDP and its trend level) is negative and...

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