Australia & New Zealand Economics Focus Will population growth save the housing market? Australia’s rapid rate of population growth doesn’t mean that house prices will always rise as population is not the most important determinant of demand over short periods of time. In any case, it’s... 11th December 2017 · 1 min read
Australia & New Zealand Economics Focus When will interest rates rise? We believe the financial markets have gone too far by pricing in a strong possibility that the Reserve Bank of Australia will raise interest rates twice next year, from 1.5% to 2.0%. Economic... 12th October 2017 · 1 min read
Australia & New Zealand Economics Focus How overvalued is housing? Once you take into account the structural decline in interest rates over the past 40 years, housing in Australia isn’t as overvalued as some analysts have suggested. In fact, in most capital cities it... 20th September 2017 · 1 min read
Australia & New Zealand Economics Focus Has economic growth passed its peak in New Zealand? While GDP growth should hold up fairly well over the next year, we expect there will be a sharper slowdown than the RBNZ and most analysts are anticipating in 2019 as the impacts of a cooling housing... 12th September 2017 · 1 min read
Australia & New Zealand Economics Focus The new long-term inflation trend History may be turned on its head over the next decade with Australia and New Zealand experiencing lower inflation rates than some of their peers. It follows that their exchange rates may be weaker... 15th August 2017 · 1 min read
Australia & New Zealand Economics Focus Consumption by sector: winners and losers While we expect that overall consumption growth will slow further this year and remain subdued in 2018 as well, not all areas of spending are equally vulnerable. Past behaviour suggests that spending... 10th July 2017 · 1 min read
Australia & New Zealand Economics Focus Further slowdown in consumption growth ahead There is growing evidence that the household sector has begun to falter and, given the worryingly weak outlook for income growth, the situation is unlikely to turnaround any time soon. Indeed, we... 5th June 2017 · 1 min read
Australia & New Zealand Economics Focus Budget response: Where’s the boost to the economy? Despite all the headlines suggesting that the Treasurer has embarked on an infrastructure spending spree, the fiscal figures appear to show that the economy is not going to be significantly stronger... 9th May 2017 · 1 min read
Australia & New Zealand Economics Focus Australia and three big global uncertainties An easing in economic growth in China coupled with the downside risks to Australia posed by the potential policies of President Trump will mean that the Reserve Bank of Australia won’t follow the US... 12th March 2017 · 1 min read
Australia & New Zealand Economics Focus Recession or rapid recovery? We wouldn’t rule it out completely, but it is looking less likely that Australia fell into its first recession since 1991 at the end of last year. However, a sustained period of stronger growth is not... 7th February 2017 · 1 min read
Australia & New Zealand Economics Focus Balancing the budget will be more painful The ratings agencies have shown that they are full of Christmas cheer by maintaining Australia’s AAA credit rating even though the Mid-Year Economic and Fiscal Outlook revealed that the budget deficit... 19th December 2016 · 1 min read
Australia & New Zealand Economics Focus The persistent part-time problem The recent rise in the share of people working part-time but who would like to work longer will continue to restrain wage growth for another couple of years yet. This part-time problem means that a... 14th December 2016 · 1 min read
Australia & New Zealand Economics Focus The structural decline in investment The structural decline of the manufacturing sector means that the long-awaited transition from mining investment towards non-mining business investment may never happen to the extent that most people... 26th September 2016 · 1 min read
Australia & New Zealand Economics Focus Inflation targeting – time for a change? The Reserve Banks of Australia and New Zealand are likely to ignore suggestions that they should lower their inflation targets since that would drive inflation even lower. Targeting nominal GDP growth... 14th September 2016 · 1 min read
Australia & New Zealand Economics Focus A new era of very low inflation The unusually low rates of underlying inflation in both Australia and New Zealand will remain a thorn in the side of policymakers for a number of years yet. This explains why we believe that the... 30th June 2016 · 1 min read
Australia & New Zealand Economics Focus US-style collapse unlikely, but house prices will still fall A US-style collapse in house prices in Australia is unlikely when lending conditions during the good times have not been as loose as in America and Australian banks are better placed to cope with the... 23rd May 2016 · 1 min read
