National Australia Bank Global & Australian Forecasts by the NAB Group Economics are out
Its a detailed document, so here's a very brief summary of their Australian outlook:
Incoming data suggests a greater degree of resilience across the non - mining economy
- High reported business conditions (+9 compared with a long - run average of +4 in October) with particular strength in services sectors
We have modestly reviewed our GDP forecasts to 2.6% in 2015/16 and 3.0% in 2016/17
- Expect a relatively strong bounceback in Q3 following a surprisingly weak Q2 due to temporary factors
Our forecast continues to envisage weak domestic demand, and a large contribution from net exports - mostly from resource exports as well as tourism and other services exports in response to the weak AUD
- Domestic demand remains subdued - the mining investment adjustment is about half way through, government spending is limited and consumer spending is expected to grow at slightly below average rates
- The forecasts contain somewhat weaker dwelling investment, although this is offset by slightly higher (though still weak) non - mining business investment
- El Niño is an emerging risk to the economic outlook. ... Many previous El Niño events have been associated with lower farm GDP. Real farm GDP declined between 0.7% and 25.4% during the last five El Niños. We forecast farm GDP (2% of the total economy) to be flat to moderately lower (0 to - 5%) in 2015 - 16, which will only marginally subtract from headline GDP
We continue to expect the RBA to remain on hold for a considerable period
Risks to the outlook are largely stemming from offshore, including slower growth in East Asia (especially in China) and ongoing financial market volatility. Our AUD forecasts are unchanged (see below).
AUD forecasts:
- 2015 - F: 0.70
- 2016 - F: 0.70
- 2017 - F: 0.73
