RBA Watch Slumping oil prices another headache for RBA The Reserve Bank of Australia (RBA) will hold rates steady at next week’s meeting and signal that the first hike is still some way off. With the downturn in the housing market continuing unabated and... 27th November 2018 · 1 min read
Australia & New Zealand Economics Weekly Immigration curbs & recession risks Immigration has been very strong in New Zealand in recent years but we think it will slow sharply over the next couple of years. By contrast, we don’t think that the Australian government will... 23rd November 2018 · 1 min read
Australia & New Zealand Economics Update RBA can hike while Fed cuts Australia’s economy has become less sensitive to conditions in the US as their trade links have diminished. The upshot is that the RBA should be able to hike interest rates in 2020 even if our... 21st November 2018 · 1 min read
Australia & New Zealand Economics Weekly Tosh analysis & good news from labour market The Australian Labor Party’s fiscal proposals may not be quite as restrictive as we had thought. But we still believe that fiscal policy would be tighter if Labor wins the next Federal election... 16th November 2018 · 1 min read
Australia & New Zealand Data Response Labour Market (Oct.) The unemployment rate remained at a six-year low in October and will probably fall a little further over coming months. However, we still think that wage growth will only pick up slowly and the RBA... 15th November 2018 · 1 min read
Australia & New Zealand Data Response Wage Price Index (Q3) The increase in annual wage growth from 2.1% in Q2 to 2.3% in Q3 is nothing to get excited about as it was partly driven by an increase in the minimum wage. What’s more, subdued growth in real wages... 14th November 2018 · 1 min read
Australia & New Zealand Economics Focus Labor’s fiscal plans would strengthen case for low rates We estimate that Labor’s plans to tighten fiscal policy would dampen consumer spending by around 0.3 percentage points in both 2019 and 2020, shaving 0.2 percentage points off GDP in each of those... 13th November 2018 · 1 min read
Australia & New Zealand Economics Weekly Central banks getting more confident Both the Reserve Bank of Australia and the Reserve Bank of New Zealand displayed a little more confidence in their optimistic forecasts when they left interest rates unchanged this week. We think that... 9th November 2018 · 1 min read
Australia & New Zealand Economics Update House prices will fall further despite supply response The recent slump in building approvals suggests that the supply overhang in the housing market may disappear next year. But we still think that the current downturn will prove to be the longest and... 7th November 2018 · 1 min read
Australia & New Zealand Economics Update RBA's optimism unlikely to materialise The upward revision to the RBA’s growth and inflation forecasts suggest that the Bank is moving closer to tightening policy. But we still think that the downturn in the housing market will result in... 6th November 2018 · 1 min read
Australia & New Zealand Economics Weekly Inflation trouble The slowdown in underlying inflation in the third quarter didn’t come as a shock to the RBA. But the bigger picture is that market forces are still keeping inflation subdued. And with early signs that... 2nd November 2018 · 1 min read
Australia & New Zealand Data Response Retail Sales (Sep./Q3) The subdued rise in real retail sales in the third quarter means that consumer spending growth probably slowed. While falling petrol prices should provide some relief to households soon, we think that... 2nd November 2018 · 1 min read
RBA Watch RBA will hold its horses until late in 2020 The Reserve Bank of Australia (RBA) will welcome the continued tightening of the labour market when it holds interest rates steady at 1.50% on Melbourne Cup Day, which falls on Tuesday 6th November... 1st November 2018 · 1 min read
Australia & New Zealand Data Response International Trade (Sep.) Continued solid growth in export volumes suggests that the trade war isn’t yet acting as a major drag for Australia’s export sector. In fact, we think that the weaker exchange rate will result in a... 1st November 2018 · 1 min read
Australia & New Zealand Data Response CoreLogic House Prices (Oct.) The continued fall in house prices in October is consistent with our view that prices will ultimately drop by at least 12%, making the current downturn the longest and deepest in Australia’s modern... 1st November 2018 · 1 min read
Australia & New Zealand Data Response Consumer Prices (Q3) The drop in inflation in the third quarter back below the 2-3% target rate won’t frighten the RBA too much, but it does look more like a scary Halloween trick than a treat. We believe the RBA will... 31st October 2018 · 1 min read
