It was a great day to give an economic outlook presentation, with RBA Governor Philip Lowe announcing a change in monetary policy guidance, from saying the next rate movement would most likely be up, to saying the cash rate may well go down rather than up. I welcomed the announcement because, in addition to it being sensible given the discouraging indicators we’ve seen lately, it was consistent with the views I was expressing in my presentation. Thanks to Ross Elliott from APP Property and Infrastructure Specialists for hosting the seminar at the Brisbane Club I spoke at, along with Luke Dixon the head of Real Estate Research at AMP Capital. Ross seemed happy neither Luke nor I were “drinking the Kool-Aid”, and we were both measured and realistic about the economic outlook. You can download my presentation at this link:
I started off by referring to recent disappointing indicators including the Suncorp-CCIQ Pulse business survey (see my post on the data) and the December 2018 retail trade data published yesterday by the ABS (see chart below). I also covered more positive indicators including international visitor expenditure and the coal price, now back over US $200/tonne for coking coal (see slide 8 in the presentation; thanks to QRC for the latest data).