Economic growth being killed by consumer, business spending 'strike'
5 years, 3 months ago

Economic growth being killed by consumer, business spending 'strike'

ABC  

Australians are hurting the economy by not spending, with household savings soaring as consumer spending plummets to its lowest level since the global financial crisis. Key points: GDP growth stepped down from 0.6pc over the quarter to 0.4pc Households appear to saving rather than spending their tax returns, as savings rose while discretionary spending saw its weakest growth since the GFC Overall growth was propped up by exports and government spending, particularly in health and disability services The much anticipated turning point in Australia's economic fortunes still seems some way down the road, with the key measure of economic growth, GDP, growing at a well below average annual pace of 1.7 per cent. People are not spending money on new homes either, with dwelling investment falling 1.7 per cent over the quarter, the fourth consecutive decline as Australia's record apartment-building boom continues its bust. "The RBA's latest forecasts shows growth returning above 2 per cent next quarter, and back above 3 per cent by end-2021. New two-speed economy CBA chief economist Michael Blythe said the weakness in household spending was the biggest threat to what was fast becoming a new "two-speed economy".

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History of this topic

Has Australia's economy turned the corner? Angus Taylor has a warning
2 weeks, 5 days ago

Has Australia's economy turned the corner? Angus Taylor has a warning

ABC  

Economists say Australia has turned a corner. Last week, he said labour productivity was still "disastrous" in Australia and the purchasing power of our wages had deteriorated "disastrously" since Labor won the election in 2022. By the time the 2022 election was held, the "real" value of our wages had already deteriorated so much that our wages were buying less …

RBA chief's major hint that there could soon be some VERY good news ahead for home-owners
3 months ago

RBA chief's major hint that there could soon be some VERY good news ahead for home-owners

Daily Mail  

The Reserve Bank has given a strong hint borrowers are getting some interest rate cuts in 2025 even though inflation is still too high. The Reserve Bank has given a strong hint interest rate cuts are coming even though inflation is still too high While headline inflation is at a three-year low of 2.8 per cent, the RBA regarded this …

RBA Is More Confident on CPI, But Too Early to Declare Victory
3 months ago

RBA Is More Confident on CPI, But Too Early to Declare Victory

Live Mint  

-- Australia’s central bank is more confident that inflation is moving sustainably toward target but it’s still too soon to conclude the battle is won given a recent pick-up in consumption and a still-tight labor market, minutes of the December meeting showed. The Reserve Bank’s board discussed scenarios in which future policy would be eased to boost economic growth or …

Share market rises after a rally on Wall Street, Australian dollar remains at two-year low — as it happened
3 months ago

Share market rises after a rally on Wall Street, Australian dollar remains at two-year low — as it happened

ABC  

OK, so a lot of this discussion is couched in coded messages. They noted that the data received since the previous meeting had not been sufficient to shift the central forecast for inflation or the labour market materially at this stage." "Relative to this central path, members judged that the risk that inflation returns to target more slowly than forecast …

Australia's unemployment rate falls to 3.9pc in November, its lowest level since March
3 months, 2 weeks ago

Australia's unemployment rate falls to 3.9pc in November, its lowest level since March

ABC  

Australia's unemployment rate fell to 3.9 per cent in November, down from 4.1 per cent in October. "The only downside to Australia's remarkably strong job market is that any hope of a near-term interest rate cut is over," said Callam Pickering, APAC economist at global job site Indeed. "Today's blockbuster November employment report seemingly pushes back — yet again — …

Australia would be in recession without rising public spending, but we might have lower interest rates
3 months, 3 weeks ago

Australia would be in recession without rising public spending, but we might have lower interest rates

ABC  

There is a cold, hard truth in the most recent economic growth numbers — governments are keeping Australia out of recession. When asked by WA Liberal senator Dean Smith last month about expressing "a note of caution to policymakers in regards to their spending appetites", Ms Bullock responded that she didn't believe she had been cautioning anyone, before adding: "What …

The brutal reality of life under Anthony Albanese as economy grows at weakest pace in more than three decades
3 months, 3 weeks ago

The brutal reality of life under Anthony Albanese as economy grows at weakest pace in more than three decades

Daily Mail  

Australia's economy is barely growing despite record-high levels of immigration and government spending, as the country enters its longest-ever per capita recession. Australia's economy is still barely growing despite record-high immigration levels The Australian Bureau of Statistics data showed GDP per capita shrank by 1.5 per cent over the year, continuing a per capita recession that began in early 2023 …

RBA leaves cash rate at 4.35pc, acknowledging it's 'restrictive,' while ASX loses ground — as it happened
4 months, 3 weeks ago

RBA leaves cash rate at 4.35pc, acknowledging it's 'restrictive,' while ASX loses ground — as it happened

ABC  

Here are some highlights from the RBA Board's statement. Underlying inflation remains too high: "Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance. "Headline inflation was 2.8 per cent over the year to the September quarter, down from 3.8 per cent over the year …

Britain's booming... but Labour's gloom and doom hits High Street: Government urged to stop talking the country down
6 months ago

Britain's booming... but Labour's gloom and doom hits High Street: Government urged to stop talking the country down

Daily Mail  

Labour has been urged to stop talking the country down after it was handed the biggest growth upgrade in the G7 but was warned that its doom-mongering was deterring ­consumer spending. The Organisation for ­Economic Cooperation and Development said Britain's gross domestic product will grow by 1.1 per cent this year, up from a previously forecast 0.4 per cent. But …

For the first time in months, household spending has fallen. Here's what Australians are cutting back on
7 months, 3 weeks ago

For the first time in months, household spending has fallen. Here's what Australians are cutting back on

ABC  

Australians are spending less on events, accommodation, and food, as household spending decreased after consecutive rises, according to new data from the Australian Bureau of Statistics. The government agency said spending fell by 0.5 per cent in June after recording a small increase in May and April. The ABS explained this was because people were spending less on recreational activities, …

US economic growth for last quarter is revised up slightly to a 1.4% annual rate
9 months ago

US economic growth for last quarter is revised up slightly to a 1.4% annual rate

Associated Press  

WASHINGTON — The American economy expanded at a 1.4% annual pace from January through March, the slowest quarterly growth since spring 2022, the government said Thursday in a slight upgrade from its previous estimate. The Commerce Department had previously estimated that the gross domestic product — the economy’s total output of goods and services — advanced at a 1.3% rate …

Australia's economy grew by 0.1 per cent in March quarter, with country 'teetering' on edge of recession
9 months, 3 weeks ago

Australia's economy grew by 0.1 per cent in March quarter, with country 'teetering' on edge of recession

ABC  

Australia's economy grew by 0.1 per cent over the first three months of 2024 and 1.1 per cent over the year, according to the Australian Bureau of Statistics national accounts. "For the fifth consecutive quarter, economic activity declined on a per capita basis and the 1.3 per cent decline over the past year is the largest Australia has experienced in …

US economic growth last quarter is revised down from 1.6% rate to 1.3%, but consumers kept spending
9 months, 4 weeks ago

US economic growth last quarter is revised down from 1.6% rate to 1.3%, but consumers kept spending

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. The Commerce Department had previously estimated that the nation’s …

RBA Sees Some Households Struggling, Suggesting Rate-Hike Limits
9 months, 4 weeks ago

RBA Sees Some Households Struggling, Suggesting Rate-Hike Limits

Live Mint  

-- Australia’s inflation is showing persistent strength and weighing heavily on the finances of some households, a senior Reserve Bank official said, highlighting the limits to further interest-rate increases. “The board are absolutely focused on the fact that inflation is clearly still above the target band,” RBA Assistant Governor Sarah Hunter said at a conference in Sydney on Thursday, referring …

Australia narrowly avoided recession this year — what these experts think will happen in 2024
1 year, 3 months ago

Australia narrowly avoided recession this year — what these experts think will happen in 2024

ABC  

Fears that Australia would enter a technical recession during 2023 didn't eventuate. "I think the last interest rate hike in November has led to a bit of a perhaps change in expectation that maybe we haven't seen the peak in interest rates in Australia," AMP's deputy chief economist Diana Mousina said. "I'll be the first to say that we were …

A rising number of households on the cusp of financial stress, but RBA says banking system isn't at risk
1 year, 5 months ago

A rising number of households on the cusp of financial stress, but RBA says banking system isn't at risk

ABC  

Australian homes and businesses are vulnerable to financial stability risks as rising inflation and interest rates continue to pressure the global economy. Key points: Australia's financial system is well-placed to deal with global economic shocks The share of households falling behind on their mortgage payments has picked up a little Despite rising rates, the vast majority of households are servicing …

Australia's economy grew by 0.2pc in March quarter, signalling marked slowdown in GDP
1 year, 9 months ago

Australia's economy grew by 0.2pc in March quarter, signalling marked slowdown in GDP

ABC  

Australia's economy grew 0.2 per cent in the first three months of 2023, according to the Bureau of Statistics. Key points: The economy is growing at an annual rate of 2.3 per cent, down from 2.7 per cent The household saving ratio has fallen to its lowest level in nearly 15 years Higher interest rates and the rising cost of …

RBA forecasts harsher short-term pain for longer term gain
1 year, 10 months ago

RBA forecasts harsher short-term pain for longer term gain

ABC  

The latest Reserve Bank economic outlook brings both bad and good news for Australians. Economic growth over the year to June is expected to be just 1.7 per cent, more than half a percentage point lower than was forecast just three months ago. The RBA had expected workers to enjoy a 4.7 per cent jump in their hourly pay rates …

RBA delivers 'massive' interest rate hit to millions of Australians already struggling with overwhelming cost pressures
1 year, 10 months ago

RBA delivers 'massive' interest rate hit to millions of Australians already struggling with overwhelming cost pressures

ABC  

It was designed to shock, and it did just that. On Tuesday, the Reserve Bank of Australia increased its cash rate target — after a month's pause — by 0.25 percentage points, to 3.85 per cent. "Don't forget that the RBA estimates that 15 per cent of variable rate borrowers will move into negative cash flow by year's end if …

The risk of Australia entering recession has just risen
2 years, 1 month ago

The risk of Australia entering recession has just risen

ABC  

There are early signs Australia's economy is buckling under the strain of inflation and cost-of-living pressures. "As regards consumer spending specifically, a sharp curtailment due to higher interest rates and weaker house prices remains the major downside risk for the economy this year." Economists predict that despite recent drops in retail sales and house prices, the Reserve Bank will likely …

US economy slowed but still grew at 2.9% rate last quarter
2 years, 2 months ago

US economy slowed but still grew at 2.9% rate last quarter

Associated Press  

WASHINGTON — The U.S. economy expanded at a 2.9% annual pace from October through December, ending 2022 with momentum despite the pressure of high interest rates and widespread fears of a looming recession. “From the Fed’s perspective, a desired slowdown in the economy will be welcome news.” Consumer spending, which fuels about 70% of the entire economy, rose at a …

What Australia's housing market has been doing over the past year
2 years, 3 months ago

What Australia's housing market has been doing over the past year

ABC  

Few sectors of the economy are as sensitive to interest rates as the property market. The fall in national values was largely driven by capital city dwelling values dropping 5.2 per cent, while regional dwelling values rose 3.3 per cent over the same period, CoreLogic figures show. Economist Maree Kilroy expects further rate hikes in early 2023, with the cash …

Economic growth misses expectations as GDP increases 0.6 per cent in September quarter
2 years, 3 months ago

Economic growth misses expectations as GDP increases 0.6 per cent in September quarter

ABC  

Australia's economic growth has come in slightly below expectations, with GDP growing by 0.6 per cent in the September quarter and 5.9 per cent through the year. Key points: Australia's economic growth slowed down from a large 0.9 per cent increase in the previous quarter GDP growth came in slightly below the typical economist forecast of 0.7 per cent Household …

New data shows the economy is going to slow significantly over the coming two years
2 years, 4 months ago

New data shows the economy is going to slow significantly over the coming two years

ABC  

The economy is slowing to a crawl, according to the latest data. Key points: NAB's Forward Growth report expects economic growth to slow below 1.0 per cent The report predicts the cash rate to reach 3.6 per cent in March 2023 New data reveals average family spending has risen 15 per cent in five years The National Australia Bank published …

US economy drops at 0.6% annual rate from April through June
2 years, 5 months ago

US economy drops at 0.6% annual rate from April through June

Associated Press  

WASHINGTON — Battered by surging consumer prices and rising interest rates, the U.S. economy shrank at a 0.6% annual rate from April through June, the government announced Thursday, unchanged from its previous second-quarter estimate. But the Fed has raised interest rates five times this year — most recently Sept. 21 — to rein in consumer prices, which were up 8.3% …

GDP growth beats expectations, but who benefits most as profits outpace wages?
2 years, 9 months ago

GDP growth beats expectations, but who benefits most as profits outpace wages?

ABC  

Australia's economic growth beat analyst forecasts over the first few months of the year, but there is evidence the benefits are being felt more by business owners than workers. Key points: GDP rose more than economists were expecting, with the economy growing 3.3 per cent over the past year Compensation of employees was up 5.5 per cent over the past …

As GDP figures are announced, Australia's economy faces two economic realities
2 years, 9 months ago

As GDP figures are announced, Australia's economy faces two economic realities

ABC  

Australia's economy is just fine, thanks. Well, the Reserve Bank's May Monetary Policy Statement said: "More broadly, the Australian economy remains resilient and is expected to grow strongly this year. In March, the Treasury stated: "Economic growth forecasts have been revised upwards, driven by stronger than expected momentum in the labour market and consumer spending." Beyond consumer spending Again, according …

US economy shrank by 1.5% in Q1 but consumers kept spending
2 years, 10 months ago

US economy shrank by 1.5% in Q1 but consumers kept spending

Associated Press  

WASHINGTON — The U.S. economy shrank in the first three months of the year even though consumers and businesses kept spending at a solid pace, the government reported Thursday in a slight downgrade of its previous estimate for the January-March quarter. Last quarter’s drop in the U.S. gross domestic product — the broadest gauge of economic output — does not …

Australians are spending as though they are in COVID-19 lockdowns, data from ANZ Bank suggests
3 years, 2 months ago

Australians are spending as though they are in COVID-19 lockdowns, data from ANZ Bank suggests

ABC  

No state or territory around the country is in lockdown, but the economic data coming through now indicates millions of Australians are behaving as if a nation-wide lockdown is in place. Key points: ANZ data shows that spending has been at its lowest level since the Delta COVID lockdowns Caution about being out in public and staff shortages has also …

RBA keeps interest rates at record low but will watch home lending 'carefully'; ASX climbs
3 years, 11 months ago

RBA keeps interest rates at record low but will watch home lending 'carefully'; ASX climbs

ABC  

The Reserve Bank has kept interest rates at a record low and will continue its programs to pump cheap money into the banking system and economy, but has said it is watching surging home lending "carefully". "The unemployment rate fell to 5.8 per cent in February and the number of people with a job has returned to the pre-pandemic level," …

Australian economy beats COVID blues to bounce back
4 years ago

Australian economy beats COVID blues to bounce back

Al Jazeera  

Australia’s economy beats expectations to expand 3.1 percent in the final quarter of 2020. “The ‘V-shaped’ nature of the recovery is everywhere to see – economic growth, the job market, retail spending and the housing market,” said Craig James, Sydney-based chief economist at CommSec. Household spending surged 4.3 percent from the previous quarter, adding 2.3 percentage points to GDP; government …

RBA boss Philip Lowe says household spending holds the key to post-COVID economic recovery
4 years, 1 month ago

RBA boss Philip Lowe says household spending holds the key to post-COVID economic recovery

ABC  

Australia has emerged from the first year of the COVID-19 crisis in much better shape than expected. Speaking at the National Press Club in Canberra, Reserve Bank governor Philip Lowe said the key economic indicator of unemployment was performing better than even the RBA's most optimistic predictions. "In our upside scenario, the unemployment rate was expected to end 2020 a …

RBA highlights risk of deeper coronavirus recession, but the Government can avert it
4 years, 7 months ago

RBA highlights risk of deeper coronavirus recession, but the Government can avert it

ABC  

In the helter-skelter world of news, it's often hard to remember what you covered last week. It turns out Australia didn't sink as deeply into this bog as the RBA had originally feared — rather than the 8 per cent fall forecast in early May, the bank now expects Australia's economy to have shrunk just 6 per cent over the …

The coronavirus recession is like no other — and it risks becoming a chronic problem
4 years, 9 months ago

The coronavirus recession is like no other — and it risks becoming a chronic problem

ABC  

Forget what you know about recessions, this one is very different — and it may be chronic. That's not to say we're about to experience years of economic contraction or "negative growth" as economists like to say, but it's going to remain tough going for many Australians for years. This is the combination of two overbearing forces: an economy built …

Quick bounce back unlikely for Australian economy post-coronavirus despite political optimism
4 years, 10 months ago

Quick bounce back unlikely for Australian economy post-coronavirus despite political optimism

ABC  

When will the penny drop? On Friday, the Reserve Bank forecast unemployment would hit 10 per cent this year and remain high until the end of next year. Our $214 billion may seem small in comparison but our direct financial injection when measured against GDP, was 10.6 per cent of our economy. If the Reserve Bank's projections are correct, and …

Almost a million Australians out of work due to coronavirus; RBA tips economy to take 10pc hit
4 years, 10 months ago

Almost a million Australians out of work due to coronavirus; RBA tips economy to take 10pc hit

ABC  

Almost 1 million Australians have lost their jobs since social-distancing measures to limit the spread of COVID-19 ramped up, new official ABS data suggests, while the Reserve Bank expects the economy to take a 10 per cent hit. Key points: The ABS says the number of jobs in Australia fell by 7.5 per cent between March 14 and April 18 …

Coronavirus has heightened 'risk aversion and uncertainty' but economy will hold up, says RBA deputy governor Guy Debelle
5 years ago

Coronavirus has heightened 'risk aversion and uncertainty' but economy will hold up, says RBA deputy governor Guy Debelle

ABC  

Coronavirus will have a negative impact on the economy, Reserve Bank deputy governor Guy Debelle says, but lower interest rates as well as the Federal Government's pending stimulus package will cushion the blow and Australia will bounce back quickly once the virus is contained. Key points: The RBA expects 0.5 percentage points will be wiped off growth in the March …

Consumers and businesses are on strike and that's dragging the economy down
5 years, 3 months ago

Consumers and businesses are on strike and that's dragging the economy down

ABC  

The private sector is on strike. "Because of the sharp increase in the saving rate, none of the aggregate tax savings showed up in new consumer spending," Jim Stanford, director of the Australia Institute's Centre for Future Work, said. "Consumer spending is likely to remain constrained while wages growth is soft at just over 2 per cent, household debt is …

Once the world’s fastest growing economy, India faces a slowdown
5 years, 3 months ago

Once the world’s fastest growing economy, India faces a slowdown

Al Jazeera  

India’s economy grew at the slowest pace in more than six years and the pain is widespread. “The private sector is definitely down both for consumption and investment and that’s the fundamental problem in the economy today,” said Madan Sabnavis, chief economist at CARE Ratings. “We’ll have to live with this low growth scenario for the rest of the year.” …

Once the world’s fastest growing economy, India faces a slowdown
5 years, 3 months ago

Once the world’s fastest growing economy, India faces a slowdown

Al Jazeera  

India’s economy grew at the slowest pace in more than six years and the pain is widespread. “The private sector is definitely down both for consumption and investment and that’s the fundamental problem in the economy today,” said Madan Sabnavis, chief economist at CARE Ratings. “We’ll have to live with this low growth scenario for the rest of the year.” …

Will a lower dollar bail out the economy, raise wages and lower unemployment? The RBA is hoping so
5 years, 4 months ago

Will a lower dollar bail out the economy, raise wages and lower unemployment? The RBA is hoping so

ABC  

Putting together the latest quarterly update on the Australian economy could hardly have been a fun job for the Reserve Bank. Key points: Wages and jobless data this week are expected to back-up the RBA's bleak view of both The RBA says a 5 per cent fall in the $A will help boost wages, push inflation into its target band …

Australia's economy has slowed to a decade low but the budget may already be back to surplus
5 years, 6 months ago

Australia's economy has slowed to a decade low but the budget may already be back to surplus

ABC  

Australia's economy has slowed to its most sluggish pace since 2009, when the GFC slammed the brakes on GDP growth, but the weak headline result may not stop the Government announcing a budget surplus a year earlier than planned. Key points: Australia's economy has posted its equal slowest annual growth since the year 2000 The economy grew 0.5pc in the …

How weakest retail sales in almost 30 years could be a sign Australia is heading for recession
5 years, 7 months ago

How weakest retail sales in almost 30 years could be a sign Australia is heading for recession

Daily Mail  

The weakest retail sales figures in almost 30 years could be a sign Australia is heading towards a recession. Consumer spending during the past financial year rose by just 0.2 per cent, despite interest rates being at a record low. The weakest retail sales figures in almost 30 years could be a sign Australia is heading towards a recession Digital …

Australia's economic slowdown heading to GFC levels as GDP growth continues to drop
5 years, 9 months ago

Australia's economic slowdown heading to GFC levels as GDP growth continues to drop

ABC  

In the compartmentalised world of information constructed by former US defence secretary Donald Rumsfeld, this is a week for "known knowns" rather than the more common "known unknowns" in the Australian economy. Retail sales: -0.1 per cent Q3 2019 compared to a flat Q4 2018 The value of construction work: -1.9 per cent compared to +2.1 per cent rise Q4 …

Australia enjoyed a mini economic boom in February as retail sales recovered, exports surged
5 years, 11 months ago

Australia enjoyed a mini economic boom in February as retail sales recovered, exports surged

ABC  

It might be just one month, but February was something of a mini-boom for the Australian economy with retail sales bouncing back and a record trade surplus being racked up. Key points: The retail recovery bucked recent trends with department stores, household goods and clothing seeing the biggest gains Queensland reported the biggest growth in sales, while Tasmania was the …

Australia's GDP shows we're in a type of 'recession' and car dealers are bearing the brunt
6 years ago

Australia's GDP shows we're in a type of 'recession' and car dealers are bearing the brunt

ABC  

Australia's economy is coming to a screeching halt and the nation's car dealers are bearing the brunt. Industry figures show new car sales in February were down a whopping 9.3 per cent on the same month last year. The release of the latest December quarter GDP figures have prompted discussion of a "per capita" recession — that is, on a …

Australia's economy just entered recession on a per capita basis
6 years ago

Australia's economy just entered recession on a per capita basis

ABC  

Australia has just recorded its second straight quarter where the economy shrank on a per capita basis. Key points: Australia's economy slowed from 4pc annualised growth at the start of 2018, to around 1pc in the second half Growth of 2.3pc over 2018 is well below RBA forecasts and places more pressure on the bank to cut rates Australia's economic …

RBA keeps interest rates on hold, giving a cooling economy the benefit of the doubt
6 years ago

RBA keeps interest rates on hold, giving a cooling economy the benefit of the doubt

ABC  

The Reserve Bank has given the Australian economy the benefit of the doubt, leaving interest rates on hold despite mounting evidence of a serious slowdown. Key points: RBA maintains the economy is strong, supported by business investment and government spending Reiterates its forecast for 3pc growth this year Main risks to the economy are weak household income and falling house …

Households' living standards are still falling as GDP per capita heads for a recession
6 years ago

Households' living standards are still falling as GDP per capita heads for a recession

ABC  

If there is one big thing that is keeping the economy from officially going backwards, it is population growth. However, anything less than 0.4 per cent GDP over the quarter means in the most basic terms the living standard for the average Australian household has gone backwards for the past six months. A resilient housing sector is a cornerstone on …

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