RBA chief sees below-average growth period for Australia

Sydney

AUSTRALIA is likely to have a period of below-average economic growth as it undergoes a "major transition", though a weaker currency and policy support will cushion the impact, central bank governor Glenn Stevens said.

"The massive run-up in resources sector capital spending that was a natural response to earlier very high prices is reversing, causing a drag on demand," Mr Stevens said in the text of a speech on Friday in Melbourne. "The decline in the exchange rate is assisting the transition. But we have always said we cannot hope to fine-tune this transition."

The Reserve Bank of Australia (RBA) needs to bring down unemployment after business spending slumped in an economy struggling to find new avenues of growth as miners curb expansion. After joining global counterparts in easing in February, the RBA paused this month, judging the economy can go…