Australia & New Zealand Economics Update House prices falls will weigh on consumer spending Households responded to rising house prices by lifting spending and we think they will eventually respond to falling prices with lower spending. This wealth effect may lower annual GDP growth by 0.3... 29th October 2018 · 1 min read
Australia & New Zealand Economics Weekly Housing matters Falling equity and house prices have both made the news this week. But when it comes to what is going to influence the Australian economy, housing matters much more. The weakening housing market is... 26th October 2018 · 1 min read
Australia & New Zealand Economics Weekly Full employment has not been achieved Even though the unemployment rate has fallen to the Reserve Bank of Australia’s 5.0% estimate of the natural rate, the RBA will still want to see signs of much faster wage growth before it hikes... 19th October 2018 · 1 min read
Australia & New Zealand Data Response Labour Market (Sep.) Whether or not the decline in the unemployment rate in September to the RBA’s estimate of the natural rate of 5.0% prompts the Bank to raise interest rates sooner depends on what happens to wage... 18th October 2018 · 1 min read
Australia & New Zealand Economics Update Revisiting the fallout from the US-China trade war Even though Australia is strongly dependent on the health of China’s economy, it won’t suffer much from China’s escalating trade conflict with the US. If anything, in the near-term it will benefit... 15th October 2018 · 1 min read
Australia & New Zealand Economics Weekly Falling equities, rising petrol, climbing borrowing costs The recent plunge in equity prices, surge in petrol prices and rise in borrowing costs all triggered by developments overseas won’t hurt the Australian economy much. But they do add to other headwinds... 12th October 2018 · 1 min read
Australia & New Zealand Economic Outlook Missing the global tightening cycle Our forecasts suggest that by the time the Reserve Banks of Australia and New Zealand get round to raising interest rates from record lows, the US Fed will already be cutting them. We think that a... 10th October 2018 · 1 min read
Australia & New Zealand Economics Weekly RBA’s upbeat tone contrasts with downbeat data We doubt that the gap between the Reserve Bank of Australia’s relatively upbeat tone and the downbeat feel of the recent economic news will be sustained for long. We suspect the RBA may become a... 5th October 2018 · 1 min read
Australia & New Zealand Data Response Retail Sales (Aug.) The rebound in retail sales in August provides further evidence that households are still proving reasonably resilient to low income growth and falling house prices. But with house prices falling at... 5th October 2018 · 1 min read
Australia & New Zealand Data Response International Trade (Aug.) The small rise in the international trade surplus in August provides more evidence that the US-China trade war is not affecting Australia’s external sector. In fact, the recent weakening in the... 4th October 2018 · 1 min read
Australia & New Zealand Economics Update Economy unlikely to live up to RBA’s expectations The Reserve Bank of Australia (RBA) sounded a bit more confident in its economic outlook when it decided to leave interest rates unchanged at 1.5% for the 26th month today. But we still think that GDP... 2nd October 2018 · 1 min read
Australia & New Zealand Data Response CoreLogic House Prices (Sep.) The largest monthly fall in house prices since the global financial crisis underlines that the current downturn may well prove to be the longest and deepest in Australia’s modern history. 1st October 2018 · 1 min read
Australia & New Zealand Economics Weekly Budget deficit, Royal Commission and election risk The shrinking budget deficit gives the Coalition government a bit more fiscal ammunition to deploy ahead of Australia’s next Federal election, while there is no way of knowing at this stage how the... 28th September 2018 · 1 min read
Australia & New Zealand Chart Pack A good year for growth The surprising strength of economic growth in the second quarter has led us to revise up our forecasts for GDP growth in the 2018 calendar year from 2.5% to 3.2% for Australia and from 2.5% to 2.7%... 26th September 2018 · 1 min read
RBA Watch Rates may not rise until late in 2020 Although the Reserve Bank of Australia will note the strength of the recent news on the domestic economy while leaving interest rates at 1.50% at the meeting on Tuesday 2nd October, it’s unlikely to... 25th September 2018 · 1 min read
Australia & New Zealand Economics Weekly Our new forecasts and the RBA’s trade war fears After revamping all our forecasts, we have concluded that the RBA and the RBNZ probably won’t raise interest rates until late in 2020 and late in 2021 respectively. That explains why we now expect the... 21st September 2018 · 1 min read
