Following its monthly monetary policy meeting on Tuesday, the bank’s board held rates at the record low level where they have been since late March when much of the economy was lockdown to stop the spread of the coronavirus.
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Australia’s international trade surplus might have risen back above $8 billion in May but that was a result of a sick economy as both exports and imports continued to fall sharply under the weight of the coronavirus pandemic suppressing demand here and offshore.
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The first real impact of the coronavirus on home building finally appeared in the approvals process for May as the Australian Bureau of Statistics (ABS) revealed a 16.4% slide in overall approvals.
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While the Australian economy is doing better than originally feared in the face of the coronavirus pandemic a senior Reserve Bank official has warned government fiscal and RBA monetary policy (interest rate) help will be needed for years.
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China’s economy seems to be getting healthier with the official June surveys of manufacturing and services (known as PMIs) both showing rises to new multi-month highs.
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Australians became slightly poorer in the March quarter, thanks to the stockmarket slump triggered by the COVID-19 pandemic and lockdowns, and that trend looks like continuing for a while as the impact of job losses, using up savings and superannuation balances and selling assets continues.
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It should be no surprise that given the COVID-19 pandemic, lockdowns, and massive job losses, that we learned on Thursday that the number of job vacancies collapsed in the three months to May.
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The Reserve Bank of NZ has left its official cash rate at 0.25 percent, but like all other central banks around the world, it remains uncertain about the future and whether the current level of stimulus is enough.
Read MoreMoody’s yesterday reaffirmed Australia’s AAA credit rating and maintained the stable outlook supported by what the group called the “underlying resilience of the economy” and the country’s “track record of proactive and effective policymaking.”
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The New Zealand economy shrank 1.6% quarter on quarter in the three months to March, the biggest drop in nearly 30 years as the impact of the country’s total lockdown to control COVID-19 hit hard.
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As expected the May jobless figures were not good – the seasonally adjusted employment fell by another 227,700 people between April and May, according to the Australian Bureau of Statistics Labour Force report yesterday.
Read MoreThe release yesterday of the Reserve Bank’s June board meeting minutes a fortnight ago did not change thinking on the outlook for the economy – it’s still tough, interest rates will remain low and unemployment is the biggest problem, even though it may not quite be the same concern as it was when the lockdowns started in March.
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China’s patchy recovery from the COVID-19 pandemic continued in May with slightly better than expected investment production and retail sales.
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Contrary to the expectations of many in Wall Street (and President Trump), the US economy won’t be taking off into recovery any time soon, according to the US Federal Reserve’s latest post monetary policy meeting statement and quarterly forecasts.
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China’s economy is still battling to regain growth momentum. Surveys of manufacturing and service sector activity for May, released last week were weaker than expected, now exports for last month have slid and imports slumped.
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Confirmation yesterday from the Australian Bureau of Statistics that Australian retail sales collapsed into a black hole in April. The trade account held up well in April as the lockdowns put in place to try and control the COVID-19 pandemic hit export revenues from tourism and education and saw another fall in imports as well.
Read MoreAnnual growth in the year to March was the slowest through-the-year growth since September 2009 when Australia was in the GFC. But there’s worse to come with some forecasts pointing to a fall of 8% or more in the June quarter.
Read MoreNo movement in the cash rate of 0.25% from the Reserve Bank’s June meeting yesterday as the bank also continues to target the three-year bond rate at 0.25%.
Read MoreMarch quarter GDP data is out today and the question is can another solid trade surplus, a sharp rise in retail volumes and a lift in government spending offset the negative impact of weak wages, business investment, construction, and housing investment and the biggest fall in business inventories in six years?
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China’s huge manufacturing sector grew at a slower pace than forecast, underlining an uneven rebound from the slide in the first quarter.
Read MoreThe economy is front and centre this week in Australia with the monthly Reserve Bank meeting tomorrow, the March quarter national accounts and GDP figures on Wednesday and a string of important data releases for April and May.
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More evidence of the weakening outlook for the economy, despite the bullishness of stockmarket investors. At the same time Reserve Bank Governor, Philip Lowe added his view to the weak outlook, warning that the economy is not in good shape with more job losses very possible.
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China’s economy is in trouble, growth is uncertain even as the Communist Party claims victory over COVID-19. The party has recognised that by dropping its GDP target for the first time ever.
Read MoreThe idea of a strong, V-shaped economic recovery that has been the belief of the Federal Government, some economists and business media, seems to be fading as the COVID-19 driven slump in the wider economy seems to be worse than forecast in some areas.
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Following a record 17.9% slide in retail sales for the month of April the final quarter of the June 30 year will be a rough one for Australia’s retailers.
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A glimmer of light for the jobs market with signs of a small improvement from the payrolls data tracked by the Australian Bureau of Statistics (ABS) in early May.
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Japan has joined Italy and France in recession as growth in the world’s third-largest economy fell an annualised 3.4% in the March quarter.
Read MoreSo will China’s central bank drop a key interest rate this week for the second month in a row after the final batch of mixed economic data for April was released on Friday?
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These social, political, and economic changes can be grouped into four categories; new, accelerated, busted, and possible trends.
Read MoreThe jobs data for April said it all – COVID-19 and the lockdowns imposed to control it across Australia by federal and state governments produced a terrible toll on jobs In April.
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This note looks at our own projections for the budget deficit, the impact on Australia’s net public debt and whether it’s affordable.
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Britain got a taste of what’s to come on Wednesday with a big slump in first-quarter growth. The country’s Office for National Statistics (ONS) said the UK economy contracted 2% in the three months to March, thanks to a massive 5.8% slump in the month of March alone.
Read MoreData yesterday confirmed that Australian salaries were falling even before the COVID-19 and associated lockdowns and job losses struck in late March.
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China’s factory prices fell at the sharpest rate in four years in April, further highlighting weakening industrial demand in the world’s second-largest economy as the coronavirus pandemic undermines global growth.
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The Reserve Bank of New Zealand has boosted its major support package by 90% to $NZ60 billion while both keeping the Official Cash Rate steady at 0.25%, and suggesting that it could be cut further.
Read MoreAccording to the NAB, the economy will not bounce back strongly as many in government and business think – the bank’s economists reckon it won’t recover until 2022, and unemployment will still be 7% next year.
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After America’s 20.5 million surge in jobless numbers, the focus for Australia this week will be on jobs data for April to be released on Thursday.
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Imports into China fell heavily in April – down 14.2% from a year earlier, but not so imports of crude oil, coal, iron ore and copper which all rose from their March levels, and all four were stronger in the first four months of the year than in the same period in 2019.
Read MoreIn something of a surprise, China on Thursday reported exports rose 3.5% in April on a year earlier, completely confounding expectations for a 15.1% fall and helping to partially offset a hefty 14.2% drop in imports.
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