Australia: Prospects of another soft quarter of GDP growth - NAB

Sandeep Kanihama FXStreet Contributor

Analysts at National Bank of Australia are forecasting that Australian growth is likely to remain soft in Q1 2019, recording a 0.4% q/q rise, continuing the weakness recorded in the second half of 2018.

Key Quotes

“We expect private domestic demand to be soft, with weak household consumption, another fall in residential investment and only a small contribution from business investment. Offsetting this weakness will be net exports and ongoing growth in public-sector spending.”

“Such a result would be weaker than the RBA’s implied forecast of 0.6% growth in the quarter, forcing it to revise downward its expectation for a rebound in activity. Given weak growth and low inflation our view is for two 25bp cash rate cuts this year, with risk of further stimulus by early 2020. Another quarter of weak growth would suggest increased risk of further stimulus.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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