Australia & New Zealand Economics Weekly Rating downgrades & pushback by the RBNZ While the credit rating downgrade of Victoria and New South Wales is justified given the deterioration in their fiscal outlook, we suspect that the RBA will continue to keep a lid on states’ borrowing... 11th December 2020 · 5 mins read
Australia & New Zealand Economics Update Australian banks unlikely to falter The capital ratios of Australian banks may decline a bit as loan deferrals come to an end and other policy support is withdrawn. But with capital ratios having almost doubled since the GFC and... 10th December 2020 · 3 mins read
Australia & New Zealand Economics Weekly Growth in 2021 likely to be stronger than most expect The rebound in GDP in Q3 was led by a big rebound in consumption. Consumption growth should slow in Q4, but with many states relaxing restrictions, we’re still forecasting a solid rise. What’s more... 4th December 2020 · 4 mins read
Australia & New Zealand Data Response Australia - Retail Sales (Oct.) The rebound in retail sales in October is likely to be overshadowed by an even larger increase in November as Victoria reopens. 4th December 2020 · 2 mins read
Australia & New Zealand Data Response Australia - International Trade (Oct.) The trade balance widened in October but the widening was partly driven by price effects so we estimate that net exports made little contribution to GDP growth in Q4. 3rd December 2020 · 3 mins read
Australia & New Zealand Data Response Australia GDP (Q3) The rebound in Q3 GDP reversed around 40% of the decline during the first half of the year and we expect output to return to pre-virus levels by mid-2021. 2nd December 2020 · 2 mins read
Australia & New Zealand Economics Update Australia - QE may not be extended in April The RBA still sounded cautious when it left policy settings unchanged today. But if our more optimistic forecasts for GDP growth and inflation are realised, the Bank may not decide to expand QE in... 1st December 2020 · 3 mins read
Australia & New Zealand Data Response Australia - CoreLogic House Prices (Nov.) House prices are now rising in Australia and we reiterate our forecast that house prices will rise by 7% in 2021, though the risks look skewed to the upside. 1st December 2020 · 2 mins read
Australia & New Zealand Chart Pack Labour markets prove resilient We have been arguing for some time that the unemployment rate would not rise as much as most believed in either Australia or New Zealand. We remain confident in those forecasts. Admittedly, the... 30th November 2020 · 11 mins read
Australia & New Zealand Economics Weekly Rebounding house prices lower need for policy easing House prices in New Zealand are 20% higher than a year ago and look poised to surge in Australia. New Zealand’s central bank is already under pressure to respond to rapid house price inflation and we... 27th November 2020 · 7 mins read
Australia & New Zealand Economics Update Vaccine to reduce need for further monetary stimulus Australia and New Zealand will benefit less than other advanced economies from a vaccine due to their success in containing the virus. Even so, we’ve lifted our 2021 GDP growth forecasts a bit and no... 26th November 2020 · 3 mins read
Australia & New Zealand Data Response Australia - Private Capex Survey (Q3) We estimate that private investment fell by a modest 1.2% q/q in Q3, and firms’ expectations of future capital expenditure suggest we may be near the trough in investment. 26th November 2020 · 2 mins read
RBA Watch RBA probably won’t extend QE any further next year The Reserve Bank of Australia won’t make any policy changes at its meeting on 1st December. And with the labour market improving much faster than the Bank had anticipated and the prospect of a vaccine... 24th November 2020 · 7 mins read
Australia & New Zealand Economics Weekly Labour market to tighten, trade tensions to persist Some analysts have expressed optimism that the signing of the RCEP will help ease trade tensions between Australia and China, but we doubt the agreement will do much to calm the waters. Meanwhile, the... 20th November 2020 · 5 mins read
Australia & New Zealand Data Response Australia Labour Market (Oct.) The surge in employment in October largely preceded the relaxing of restrictions in Victoria so we expect that November data should show a further rise. 19th November 2020 · 2 mins read
Australia & New Zealand Data Response Australia - Wage Price Index (Q3) The weakness in wage growth in Q3 was partly driven by the delay to the minimum wage increase but we still think overall wage growth will remain soft in the years ahead. 18th November 2020 · 2 mins read
