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RBA to push back taper

With New South Wales today declaring a “national emergency” in response to the worsening outbreak of the highly contagious Delta variant, we now expect the Reserve Bank of Australia to play its part by keeping bond purchases at $5bn per week until November.
Marcel Thieliant Senior Japan, Australia & New Zealand Economist
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More from Australia & New Zealand

Australia & New Zealand Economics Weekly

Housing downturn to weigh on activity

The housing downturn is now in full swing. While that hasn’t prevented a solid rise in consumption in Q2, we think falling wealth will be a drag on consumer spending next year. What’s more, our forecast that house prices will eventually fall 15% from their April peak would be consistent with dwelling investment falling sharply in the coming years. The upshot is that the housing downturn will bring the Australian economy close to recession next year.

1 July 2022

Australia & New Zealand Data Response

Australia CoreLogic House Prices (Jun.)

The monthly decline in house prices in June was the largest since 2019 but is unlikely to be the sharpest decline in the current downturn. We think house prices will eventually fall by 15% from their April peak, which will weigh heavily on GDP growth next year.

1 July 2022

Australia & New Zealand Data Response

Australia Retail Sales (May 2022)

The strong rise in retail sales in May highlights the strength in the Australian economy and is consistent with our view that the RBA will continue to hike rates aggressively in the months ahead.

29 June 2022

More from Marcel Thieliant

Australia & New Zealand Economics Update

Australia - Vaccine rollout has yet to alter health situation

With Sydney tightening its lockdown and the one in Victoria set to be extended, we now expect GDP to shrink by 0.5% q/q in Q3. The vaccine rollout isn’t advanced enough yet to ease the medical situation meaningfully, but it is set to keep accelerating and render lockdowns obsolete by the end of the year.

19 July 2021

Japan Economics Update

Bank shifting focus away from emergency response

The Bank of Japan today unveiled the details of its green lending facility, underlining that its focus is now moving away from addressing the pandemic towards longer-term structural issues.

16 July 2021

Australia & New Zealand Economic Outlook

Central banks to tighten as bust turns to boom

Sydney’s lockdown will keep a lid on Australia’s recovery for now, but booming housing markets should support consumer spending and dwellings investment in both countries. We don’t expect labour shortages to ease much when the border opens, so wages growth may finally accelerate. That should prompt the RBNZ to start hiking rates next month and the RBA to follow in 2023.

15 July 2021
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