Economists See Fallout from Mining Peak

The country’s top economists have warned against the messy fallout that may arise from the mining peak. They also said that the transition from the country’s dependence from mining to non-mining may take time.

Economists, however, are uncertain whether we have reached or even have passed the end of the mining peak. But one thing they are all in agreement that the country needs to have a non-mining boost to fill the gap.

According to Alan Oster, the onset of the mining peak may occur faster than anticipated. He said that there are increasing indications of this. Oster is the chief economist of the National Australia Bank.

He added that the end of the mining boom may lead to unemployment. He, however, said that the lower borrowing rates and the falling Australian dollar may cushion the blow.

Economists predict that the jobless rate may increase to 5.9 percent by June 2014. This is slightly higher than the forecast of 5.75 percent. The uphill trend of the Australian dollar may have also peaked as the last few months have seen the Australian dollar falling and in parity with the US dollar.

Nigel Stapledon said that the weaker Australian dollar would benefit many sectors. Stapledon is from the Australian School of Business.