RBA Watch RBA should reach the rate floor & begin QE in 2020 The economic data have continued to deteriorate in line with our forecasts. In particular, the unemployment rate rose again to 5.3% in October and real retail sales declined in Q3 despite the... 27th November 2019 · 7 mins read
Australia & New Zealand Economics Focus Productivity growth should pick up again soon The recent weakness in productivity is largely cyclical and reflects the slump in homebuilding. While Australia probably won’t be a frontrunner in the digital revolution, we expect labour productivity... 25th November 2019 · 13 mins read
Australia & New Zealand Economics Weekly Government flipflops on fiscal stimulus The government has flipped on its stance that the previous tax cuts were sufficient to stimulate that economy, announcing fresh fiscal stimulus in the form of infrastructure spending this week. But at... 22nd November 2019 · 5 mins read
Australia & New Zealand Chart Pack QE will result in lower bond yields in Australia The decline in bond yields in Australia and New Zealand throughout 2019 has paused in recent months following optimism about a potential trade deal between the US and China and hawkish language from... 21st November 2019 · 10 mins read
Australia & New Zealand Economics Update Share buybacks are not to blame for weak investment The recent surge in stock buybacks has largely been driven by mining and financial firms and therefore can’t explain the weakness in non-mining investment. Non-mining profit growth should rebound a... 18th November 2019 · 4 mins read
Australia & New Zealand Economics Weekly Labour market will remain RBA’s headache We wouldn’t read too much into October’s largest fall in employment in three years as the monthly data are volatile. But we still expect the unemployment rate to rise in the coming months as the... 15th November 2019 · 3 mins read
Australia & New Zealand Data Response Labour Market (Oct.) The sharp fall in employment will be causing concern for the RBA and we think the unemployment rate has further to rise in the coming months. 14th November 2019 · 2 mins read
Australia & New Zealand Data Response Wage Price Index (Q3) The slowdown in wage growth in the third quarter doesn’t come as a complete surprise to the RBA and we still expect the Bank to wait until February before cutting rates again. 13th November 2019 · 2 mins read
Australia & New Zealand Economics Weekly GDP growth isn’t picking up The decline in capital goods imports over the past year suggests that business investment is set to fall further in the second half of the year . What's more, the fall in real retail sales in Q3 point... 8th November 2019 · 6 mins read
Australia & New Zealand Economics Update RBA indicates further easing may be needed By signalling that inflation will remain below the lower end of its 2-3% target band for the foreseeable future, the RBA signalled that further easing is on the cards. Our view remains that the Bank... 8th November 2019 · 3 mins read
Global Markets Update What QE would mean for Australia’s financial assets Against a backdrop of stubbornly-low inflation and rising unemployment, we now think that the RBA will launch quantitative easing (QE) in 2020. Here, we consider the implications for Australia’s... 7th November 2019 · 3 mins read
Australia & New Zealand Data Response International Trade (Sep.) Net trade probably didn’t bolster GDP growth in the third quarter which adds to the evidence that GDP growth slowed in Q3. And weaker capital goods imports suggest that the slump in business... 7th November 2019 · 2 mins read
Australia & New Zealand Economics Update RBA still has more work to do The RBA reiterated its view that the economy had reached a gentle turning point when it left rates unchanged today. However, we think that the Bank’s forecasts for GDP growth and the labour market... 5th November 2019 · 3 mins read
Australia & New Zealand Data Response Retail Sales (Sep./Q3) The decline in real retail sales in the third quarter suggests that consumption growth remained subdued. And with the bulk of the tax refunds already paid, the outlook for the fourth quarter isn’t... 4th November 2019 · 2 mins read
Australia & New Zealand Economics Weekly Strong goods inflation probably won’t last The resilience in Q3 inflation was driven by the strongest increase in goods prices in a decade. But with import price growth now slowing, we think that strength won’t last. Meanwhile, we’ve lifted... 1st November 2019 · 7 mins read
Australia & New Zealand Data Response CoreLogic House Prices (Oct.) Our sales to new listings ratio suggests that house prices will continue to surge in the coming months before moderating in the new year. We expect prices to rise by 5% in 2020 and 2021. 1st November 2019 · 2 mins read
