Australia’s Economy is Flat

Australia’s Economy is Flat

Australia’s central bank stuck to its upbeat view of the economy after it held rates at record lows in a widely expected move Tuesday, a day before GDP data is likely to show domestic momentum almost stalled last Quarter.

The Reserve Bank of Australia (RBA) ended a 30th meeting running with rates at 1.50% and signaled a steady policy outlook as it awaits a pick up in economic growth and inflation.

That wait may prove longer with a run of soft data from consumption to housing this week leading analysts to downgrade forecasts for Q-4 growth to near nothing. Official figures on GDP are out Wednesday.

A weak number could jeopardize re-election prospects for Australia’s center-right government which has been pitching “jobs and growth” as its Key mantra.

The Liberal-National government faces a tough election in May and is widely expected to entice voters with tax cuts and more spending in its annual budget on 2 April.

Analysts polled by Reuters suspect the economy expanded by a sub-par 0.3% in the December Quarter, after a disappointing 0.3% rise in Q-3 of Y 2018.

Annual growth is seen slowing to 2.5% from 2.8%, making the RBA’s call for 3% this year look optimistic.

Stay tuned…

Australia, economy, GDP, flat, tax, cuts, spending, RBA, bank, inflation,

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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