The Westpac-Melbourne Institute leading index indicates the likely pace of economic activity relative to trend over the next three to nine months.
The February result is still negative, coming in at -0.94%. This is a slight improvement from January's -1.04%.
- the growth rate has been in negative territory for seven months in a row
- and still points to below-trend growth in the months ahead
Westpac chief economist Bill Evans said the slowdown reflects
- the lagged effect of the rise in interest rates
- the fall in real wages
- a bottoming-out of the savings rate
- falling house prices
And
- "Recent developments in the global banking system are unlikely to significantly impact Australia's financial system but will be a further headwind for the major advanced economies, particularly through a reduction in credit availability and knock to confidence,"
- "This, in turn, will have indirect implications for Australia's growth prospects."
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I posted earlier on WPAC's RBA forecast for April and May:
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The cycle so far from the RBA.
10 meetings, 10 hikes in a row (there was no meeting in January).
