Australia & New Zealand Economics Update Looser policy on the cards before long The Reserve Bank of Australia slowed the pace of monetary tightening by delivering a smaller 25bp rate hike to 2.60% this month, but we still expect rates to peak a touch higher than most anticipate... 4th October 2022 · 3 mins read
Australia & New Zealand Economics Update RBA recapitalisation not off the table yet Despite incurring a record loss last year and now having to operate with negative equity, the RBA has not requested a recapitalisation from the government. But given that it did receive a capital... 21st September 2022 · 4 mins read
Australia & New Zealand Economics Update Aggressive tightening will be reversed next year The RBA lifted rates by 50bp today and dropped some hints that further tightening will be less aggressive. Even so, we still expect the Bank to hike rates more aggressively over coming months than... 6th September 2022 · 3 mins read
Australia & New Zealand Economics Update Chinese property slump not a huge headwind If the slump in China’s property sector continues for much longer, Australia’s export revenue would take a hit as iron ore prices tumble. But there are good reasons to think that the impact on... 24th August 2022 · 4 mins read
Australia & New Zealand Economics Update RBNZ will hike rates to 4% but cut next year The RBNZ lifted the overnight cash rate by 50bp to 3% today as everyone had anticipated and signaled that it will deliver another 50bp hike in October. We now expect the Bank to hike rates to a peak... 17th August 2022 · 5 mins read
Australia & New Zealand Economics Update Higher migration not enough to cool labour market An increase in the permanent migration programme will help to alleviate labour shortages. But the rapid tightening of the labour market in recent months has been driven by strong labour demand rather... 16th August 2022 · 2 mins read
Australia & New Zealand Economics Update The implications of an escalating Taiwan crisis The extent to which neighbouring countries would be affected by an escalation of tensions between China and Taiwan would depend both on which sides they take and on the nature of restrictions imposed... 10th August 2022 · 4 mins read
Australia & New Zealand Economics Update RBA will cut interest rates next year The Reserve Bank of Australia revised up its inflation forecasts sharply when it lifted the cash rate by 50bp today and we expect it to hike rates more aggressively over coming months than most... 2nd August 2022 · 3 mins read
Australia & New Zealand Economics Update Australia - What if homebuilding doesn’t slump? Our view that GDP growth will slow below potential next year assumes one of the sharpest falls in dwellings investment in Australia’s modern history. However, this Update explains why dwellings... 25th July 2022 · 4 mins read
Australia & New Zealand Economics Update Australia - What to expect from the monetary policy review We doubt that the upcoming review of Australia’s monetary policy framework will result in a change to the RBA’s 2-3% inflation target. But the Bank could be forced to put more emphasis on house prices... 20th July 2022 · 4 mins read
Australia & New Zealand Economics Update RBNZ hiking cycle will end by year-end The Reserve Bank of New Zealand hiked rates by 50bp in July but emerging worries about the health of the economy are consistent with our view that rates will peak around 3.5% rather than the 4%... 13th July 2022 · 3 mins read
Australia & New Zealand Economics Update RBA to hike to around 3.5% but will cut in late-2023 The RBA sounded a little more cautious about the outlook for the economy when it hiked rates by 50bp today, but we suspect that further upside surprises to inflation will encourage it to eventually... 5th July 2022 · 3 mins read
Australia & New Zealand Economics Update Minimum wage rise will keep RBA hiking aggressively The 5.2% increase in the minimum wage announced by the Fair Work Commission will directly lift the Wage Price Index by around 0.7%-pt. But the increase will also contribute to upward pressure on wage... 15th June 2022 · 3 mins read
Australia & New Zealand Economics Update Housing downturn will prompt RBA rate cuts in 2023 With the RBA set to hike the cash rate to 3% by early-2023, we now expect house prices to fall by 15% from their April peak. While the economy has considerable momentum from reopening in the near-term... 8th June 2022 · 3 mins read
Australia & New Zealand Economics Update Australia - Rates to rise to 3% by early-2023 The 50bp hike in the cash rate today is consistent with our view that interest rates will peak at higher levels than most anticipate and we’re expecting additional 50bp hikes in July and August. 7th June 2022 · 3 mins read
Australia & New Zealand Economics Update Australia - The case for a windfall tax on mining profits The rapid improvement in the public finances means that the government can provide financial support to households struggling with high energy bills without raising taxes. But if it did decide that... 31st May 2022 · 2 mins read
