The lockdown situation is twice as bad as the RBA had in their August SOMP. Using Gov Lowe’s rule of thumb that consumption falls 15%, a Q3’21 GDP forecast of around -3% seems plausible (v. RBA -1% in the Q3 SOMP). The probability that the taper is dropped in Sep is rising.
The RBA has ‘looked through’ the delta-outbreak, and retained some of the upgrade that drove the July taper. A downgrade that drives easing is plausible, but it’ll take some time for the data to make the case
The RBA eschewed the signal-value of reversing the taper. My hunch is that they are worried about their market footprint and housing.
COVID lockdowns have over-taken the RBA’s recent upgrade of the current assessment from ‘recovery’ to ‘expansion’. A contraction in Q3 would extend the life of QE and boost the peak-size of the RBA’s balance sheet.
The decline of the unemployment rate to 4.9% in February caused the market to substantially reduce the implied probability of
The annual revisions to GDP, and a weak 0.3%qoq in Q3 , mean that the GDP boom of H1’18 has
The RBA has set things up to resume the easing cycle that began in 2011 (I never believed in the whole ‘neutral’
The Sun’s Terry McCrann has published a great column on the nomination of Yellen and what it might mean for
There was some confusion about core CPI yesterday, thanks to the divergence between trimmed mean CPI & weighted median CPI
The Q2 CPI result came in around where i was expecting, with headline CPI a little higher (it was 0.4%q/q
Today we have Australian Q2 CPI. My best guess is that Q2 headline CPI will be around 0.25%qoq, which will
Following last week’s Q1 National Accounts, I cheekily suggested that the domestic economy was in recession. Many of my peers