Australian Q3 GDP is due next week (December 7 at 0130GMT)

  • Current median consensus is +0.4% q/q (+2.6% y/y)
  • Prior +0.5% q/q (+3.3% y/y)

Concerns are that with the string of weak Q3 data so far:

  • Australia: Q3 Construction Work Done: -4.9% q/q (expected -1.6% and prior -3.7%)
  • Westpac says today's data adding to evidence the economy hit a soft spot in mid-2016
  • Australia - Q3 Capex (Private Capital Expenditure): -4.0% (expected -3.0%)
  • The Australian Q3 capex (further) slump - responses

and, weaker monthly data ... for example:

  • Australian Building Approvals for October: -12.6% m/m ( expected +2.0%, prior -8.7%)
  • HIA new home sales for October -8.5% m/m (prior +2.7%)
  • (Note these data points from October, which is not in Q3, I have included them only as examples of softer than expected data points)

... concerns are the Q3 GDP will be substantially weaker, maybe even a negative (for the q/q). Some of the bank forecasts so far 9I'll have more as we approach December 7):

  • Westpac's current estimate is 0.2% - the lowest since March quarter 2011
  • JPMorgan is at +0.3%
  • ANZ are at 0.0% & say "recent partial data suggest that GDP growth will slow substantially in Q3 .. . likely to be below the RBA's estimate"

(RBA was most recently at +0.7% for Q3 q/q)

  • Morgan Stanley forecasting -0.3% q/q

More to come on these as we approach the release. But it isn't looking good and while consensus is +0.4% the bigger risk is to the downside.