This release does not tend to have much of an immediate impact on the AUD. Nevertheless, a useful indicator for the economy ahead (it has been persistently indicating sub trend growth).
The prior revised down from 0.05%.
The six month annualised growth rate in the Westpac- Melbourne Institute Leading Index
(indicates the likely pace of economic activity relative to trend three to nine months into the future)
- fell from -0.28% in December to -0.46% in January.
WPAC add:
- growth rate in the Leading Index remains below zero, indicating momentum will track well below trend
- January represents the fourteenth straight month that the Index growth rate has been negative
- This update points to weak underlying economic momentum continuing in the first half of 2020
- After taking into account our estimate for the impact of the coronavirus and the bushfires in the first quarter of 2020 we have revised down our forecast for growth to 0% in the March quarter from 0.5%
- That is now estimated to be followed by a 0.8% (0.5% underlying) in the second quarter as the effects of the virus disruptions dissipate and some rebuild begins in the aftermath of the bushfires. Growth momentum is expected to lift in the second half as the rebuild from the bushfires comes through.
