This paper explores the merits of introducing a retail central bank digital currency (CBDC) in Australia, focusing on the extent to which consumers would value having access to a digital form of money that is even safer and potentially more private than commercial bank deposits.

Recent papers have argued that monetary policy and economic conditions can influence the amount of innovative activity in the economy, and therefore productivity and living standards in the future. This paper examines whether this is the case for Australia - a small open economy that tends to import innovation from overseas.

Every three years since 2007 the Reserve Bank has conducted a Consumer Payments Survey, which provides comprehensive information on how Australians make payments. The 2022 survey is the first to be conducted since the COVID-19 pandemic, and so provides a valuable snapshot of its impact on consumer spending patterns.

This paper explores a new approach to identifying the effects of monetary policy using high-frequency data around monetary policy decisions and other announcements that allows us to explore different facets of monetary policy.

Labour productivity growth is the key driver of living standards over the medium term. However, growth in labour productivity has slowed markedly over recent decades in Australia and other advanced economies, leading to slower growth in people’s incomes.