Westpac leading index, in at -0.3% m/m
- The prior revised to -0.3% from 0.2%
In the release each month WPAC highlight the "six month annualised deviation from trend growth rate"
- It indicates the likely pace of economic activity three to nine months into the future
- In December (i.e. this releas4e) it fell from -0.40% in November to -1.03% in December
More from the release (bolding mine):
- Another disappointing result
- The Index has now been growing below trend for the last eight months
- It continues to signal that growth in the Australian economy in the first half of 2016 will be below trend
- Apart from in August 2015, this deviation represents the largest negative deviation we have seen since the second half of 2011
Recall that both Treasury and the Reserve Bank are now assessing trend (or potential) growth at 2.75%. Westpac's current forecast for 2016 entails an annual growth pace in the first half of 2016 of 2.75% (trend). The signal from the Leading Index indicates that our forecast may be somewhat optimistic.
AUD is barely changed. This is rarely an immediate market moving piece of data.
But, as for the picture its painting on the Australian economy, its a concern.
