ANZ have bumped their expectation for Q2 economic growth a little higher after yesterday's data.
Before I get to ANZ, here are some other forecasts that followed the data on Tuesday:
- Another Australia GDP forecast ... "a negative is still possible"
- Australia GDP data due Wednesday - what to expect
ANZ forecast is for 0.5% q/q and 1.4% y/y:
- stronger government spending, net exports and profits … more than offset the weakness in inventories
- headline growth number, however, belies the underlying weakness in the economy.
- private demand looks … to be down 0.6% over the year
- mainstay of economic growth at the moment is public demand … This highlights the difficulty for the government and the RBA, in generating measures to support the economy when public spending is already the key driver of growth.
(ps. I'm happy ANZ made this point, the RBA has been bleating on about fiscal support … my cynical view is this is partially due to the Bank complacency in holding rates too high for about 18 months …. anyway, back to ANZ)
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The data should have implications for the AUD, low is a negative, high is a positive.
BUT … don't forget folks this data is for April - June 2019. Its now September. Any response from the AUD will be cushioned by assessments turning to the future, not the past.
