5 Sep 2013
Flash: RBA still to cut by 25bp in Nov despite 0.6% Q2 GDP - Nomura
FXstreet.com (Barcelona) - Australian GDP grew by 0.6% q-o-q in Q2 2013 (2.6% y-o-y), which according to Nomura Economist Charles St-Arnaud and Strategist Martin Whetton, reflects growth that was around trend.
Key Quotes
"While the composition of growth was more positive than in Q1, some of the sources of strength could prove temporary. More specifically, the strength in private investment could be brief, as the latest capex survey suggests that capital expenditure should remain weak for the rest of the year."
"The slower household disposable income growth is a sign that household spending should moderate somewhat in the near term. Moreover, the increase in the saving rate shows that households still prefer to deleverage than increase consumption and spend the extra money liberated by the lower interest rates."
"We continue to believe that the RBA will cut its policy rate by another 25bp in November, unless inflation surprises on the upside."
Key Quotes
"While the composition of growth was more positive than in Q1, some of the sources of strength could prove temporary. More specifically, the strength in private investment could be brief, as the latest capex survey suggests that capital expenditure should remain weak for the rest of the year."
"The slower household disposable income growth is a sign that household spending should moderate somewhat in the near term. Moreover, the increase in the saving rate shows that households still prefer to deleverage than increase consumption and spend the extra money liberated by the lower interest rates."
"We continue to believe that the RBA will cut its policy rate by another 25bp in November, unless inflation surprises on the upside."