Digital Finance Analytics (DFA) Blog
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Australia’s gross domestic product (GDP) grew by 0.4% in the March quarter 2019, following a 0.2% rise in the December quarter. The Australian economy grew 1.8% through the year, according to the ABS. This is well below the 2.75% trend average. The expenditure measure of GDP grew by only 0.2%, below expectations. Trend GDP per … Continue reading “March GDP Result Weak Again”
Governor Lowe explains. In summary: Expect more cuts. Banks should pass on the cuts. Borrowers will benefit more than savers in the interests of the economy. The exchange rate will fall. Spare capacity in the economy needs to be utilised. At its core, today’s decision was taken to support employment growth and to provide greater … Continue reading “The RBA On The Cash Rate Cut”
The RBA has reduced the cash rate by 0.25% today as expected. Further signs of a weakening economy, exposed to the international risks which are rising. Given the BBSW has moved towards the banks in recent times, there is no excuse not to pass the full cut to existing borrowers. The question is, will they? … Continue reading “RBA Cuts As Expected”
RBA Governor Lowe set out his views in Brisbane. What hope the budget surplus then? I would like to begin by providing an update on recent developments in the global and Australian economies. I will then discuss how our thinking on the appropriate stance of monetary policy has evolved over recent times. The Global Picture … Continue reading “RBA All But Confirms Cash Rate Cut Ahead”
The RBA released their minutes today, and things are looking less rosy, even though their rose-tinted glasses. International Economic Conditions Members commenced their discussion of the international economy by observing that global growth had eased in the second half of 2018 and looked to have continued at around this more moderate rate in 2019. Growth … Continue reading “RBA Minutes: Weaker Growth, Watch The Labour Markets!”
The RBA released their quarterly Statement On Monetary Policy today. Expect rate cuts, and QE later as the AUD is allowed to slide, as a decade of wrong policy is now coming home to roost. Plus they are tracking the labour market as a key determinate of policy using the wobbly ABS series data, looking … Continue reading “RBA Cuts Growth And Inflation Forecasts; Rate Cuts Will Follow”
At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent. They reinforced the labour market as the key to future rate moves, looking past lower inflation. That is a pretty strong signal about what would lead to a cut. They are still reciting stronger growth than many believe … Continue reading “RBA Holds, As We Expected”
The latest data from the bea shows a GDP provisional estimate significantly above expectations, which may suggest the FED will not have to be as patient as they signalled recently. Perhaps expectations of a future recession are overblown? Real gross domestic product (GDP) increased at an annual rate of 3.2 percent in the first quarter … Continue reading “US GDP Surprises Higher”
The RBA released their minutes today, and they highlight the current tensions between the domestic GDP and labour market data evolve. But more negative news was recited in the minutes, and this suggests rate cuts, not rate rises. International Economic Conditions Members commenced their discussion by noting that the slower pace of global economic activity … Continue reading “RBA More Dovish?”
The OECD has released a report Under Pressure: The Squeezed Middle Class which underscores the fact that relative to the more affluent, those in the middle are getting squeezed. 40% are financially at risk. Timely given the current Australian election! Much of this is because of the high costs of housing relative to incomes. The … Continue reading “The “Middle Class” Is Under Pressure”