New motor vehicle sales data for April released by the ABS yesterday support the RBA Board’s decision to cut the cash rate on Budget day earlier this month, with sales down 2.5% in April nationwide, and down 7.7% in Queensland, but I would note the data tend to be volatile (see the ABS Summary). In its Summary, the ABS noted:
The largest downward movement across all states and territories, on a trend basis, was in Queensland (-0.5%), continuing a downward trend which commenced in November 2015.
Time series data for new vehicle sales confirm Queensland’s under-performing economy relative to other States, with new vehicle sales lower in Queensland than before the financial crisis (e.g. over 9% lower than at the end of 2007) compared with much higher sales in NSW (+23%) and Victoria (+17%) (see chart below).
New vehicle sales have fallen 3.7% in Queensland through-the-year, compared with growth of 9.8% in NSW and 0.8% in Victoria (see chart below). It is very likely that the boom in property prices in Sydney had a flow-on impact on new vehicle purchases.