RBA governor says AI could be a bubble and isn’t yet boosting Australian productivity
RBA governor Michele Bullock told a CEDA event in Sydney that AI could be a bubble and that there is no evidence it is making the economy more efficient, contrary to the Albanese government’s claims. She said the RBA and overseas counterparts view AI as a “great white hope” for productivity but have seen little sign of impact, noting rapid datacentre investment is adding to inflation. Bullock…
Key points
- RBA governor Michele Bullock said AI could be a bubble and shows no sign of boosting productivity yet.
- Intergenerational report projects per‑person activity $157,300 by 2066 at 1.2% productivity growth; economists deem 0.8% more realistic.
- House prices fell 3.1% in three months and home‑loan approvals slumped, with >90% chance rates rise to 4.6%.
The government’s intergenerational report projects per‑person economic activity to rise from $99,200 today to $157,300 by 2066, assuming a 1.2% annual productivity increase – a figure economists say is unlikely, with a 0.8% rate yielding only $136,600. Bullock also highlighted a housing downturn, with house prices down 3.1% over three months and home‑loan approvals slumping, especially for investors. Traders see more than a 90% chance of the cash rate rising from 4.35% to 4.6% at the next meeting.
AI could be a bubble and is not yet making Australia more productive, Michele Bullock says
The Guardian AI · 22 September 2026
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