Australia & New Zealand Data Response Australia Private Capex Survey (Q3 21) Private capital expenditure dropped during the recent lockdowns but firms’ forecasts point to a strong rebound over the coming quarters. 25th November 2021 · 2 mins read
Australia & New Zealand Economics Update Australia - Rate hikes will result in housing downturn High household debt will magnify the impact of interest rate hikes on the housing market and we now expect prices across the eight capital cities to fall by 5% from H2 2023. The upshot is that the RBA... 24th November 2021 · 3 mins read
Australia & New Zealand Economics Weekly Wage growth and inflation to continue to strengthen RBA Governor Phillip Lowe doubled down on the view wage growth will remain too low to justify a rate hike anytime soon. But wages for workers on individual agreements is soaring. And we think wage... 19th November 2021 · 6 mins read
Australia & New Zealand Data Response Australia Wage Price Index (Q3) The 0.6% q/q rise in the wage price index in Q3 will provide the RBA with some confidence that rates need to remain low in the near term. But we think that wage growth will rise over 2022, putting... 17th November 2021 · 3 mins read
Australia & New Zealand Economics Weekly Inflation will keep the RBA under pressure Business purchase costs in the October NAB survey rose to their strongest level since 2008, consistent with trimmed mean inflation of nearly 1.5% q/q. That probably overstates the strength in... 12th November 2021 · 5 mins read
Australia & New Zealand Data Response Australia Labour Market (Oct.) The rise in the unemployment rate suggests that the labour market continued to suffer right up until the end of the recent lockdowns. But given the ending of lockdowns in mid-October we expect the... 11th November 2021 · 2 mins read
Australia & New Zealand Economics Update RBA recapitalisation would lift public debt Rising interest rates will result in the RBA making further losses in the years ahead. The Bank’s existing reserves should be enough to absorb those losses in a benign scenario, but the Bank will stop... 9th November 2021 · 3 mins read
Australia & New Zealand Economics Weekly RBNZ set to hike by 50bp, RBA remains the archdove The exceptional strength of New Zealand’s mean that we now think the RBNZ will hike rates by 50bps in November and by a further 100bps next year, which would take the OCR to 2.0%. That’s above the... 5th November 2021 · 5 mins read
Australia & New Zealand Economics Update Australia- The impact of rate hikes on household finances If the RBA hiked rates by nearly 200bp as the financial markets were anticipating until recently, households’ debt servicing burden would hit an all-time high and housing would become the least... 3rd November 2021 · 3 mins read
Australia & New Zealand Economics Update Patient RBA set to hike rates only gradually The RBA abandoned its yield target and its pledge that rates will remain low until 2024 today, but still sounded dovish. While the financial markets expect the first rate hike in May next year, we... 2nd November 2021 · 3 mins read
Australia & New Zealand Data Response Australia CoreLogic House Prices (Oct.) Strong demand means that house prices will keep rising at a strong pace over the next few months, but we think that lending restrictions will result in a slowdown next year. 1st November 2021 · 2 mins read
Australia & New Zealand Chart Pack Surging inflation puts pressure on monetary policy Trimmed mean inflation rose to 2.1% in Australia in Q3, the first time it has entered the RBA’s 2-3% target band since 2015. Even more strikingly, trimmed mean inflation in New Zealand rose to 4.4%... 29th October 2021 · 11 mins read
Australia & New Zealand Economics Weekly RBA set to ditch yield target next week The rise in trimmed mean inflation into the RBA’s 2-3% target band for the first time in six years has only added to the aggressive repricing in the outlook for the RBA’s policy rate over the past... 29th October 2021 · 7 mins read
Australia & New Zealand Data Response Australia Retail Sales (Sep. 2021) The rise in retail sales in September means that the trough in consumption is now behind us. We expect retail sales to rebound in Q4 as restrictions relax and a growing number of Australians are able... 29th October 2021 · 2 mins read
RBA Watch RBA’s dovish view increasingly under pressure The acceleration in underlying inflation increases the pressure on the RBA to adjust its forward guidance. But with wage growth still sluggish, we think it will stick to its pledge that rate hikes are... 27th October 2021 · 8 mins read
Australia & New Zealand Data Response Australia Consumer Prices (Q3 2021) The decline in headline inflation in Q3 was entirely driven by base effects. More importantly, the strong rise in underlying inflation will keep pressure on the RBA to keep reducing monetary stimulus. 27th October 2021 · 3 mins read
