CommBank View: Economics & Markets

The CommBank Household Spending Intentions (HSI) index for April 2023 declined by 4.3%/mth in original terms, led lower by Home buying, Health & fitness, Transport and Household services.  The weakness in April was partly driven by seasonal factors, ie. less trading days on the month due to the public holidays, but in seasonally adjusted terms the HSI index was also slightly down. In this podcast...

The RBA Board today increased the cash rate by 25bp to 3.85%, as we had anticipated.  But today’s outcome was not expected by financial markets or the forecasting community.  In this podcast, Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss how the Bank’s forward guidance has been further watered down to a soft tightening bias and the policy outlook from here....

The CommBank Household Spending Intentions (HSI) index for March 2023 rose by a solid 8%/mth in original terms, following on from declines in January and February. The increase in March was partly due to the increased number of calendar days in March and other seasonal factors. Importantly the annual rate of growth continues to moderate. Stephen Halmarick, Chief Economist and Belinda Allen, Senior...

Join Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist in this podcast which brings together the outlook for the both the global and Australian economy. Stephen also provides thoughts on the recent banking issues, supply chains and inflation as well as the Global Economic and Markets Research teams focus on Sustainable Economics.   ------ DISCLAIMER ------ Before listening to...

In this latest podcast, Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss the Q4 22 National Accounts. GDP growth rose by 0.5%/qtr and suggests the growth momentum in the Australian economy is slowing quickly. Over the quarter consumer spending rose, albeit less than expected while business investment and residential investment both fell. The international secto...

In this latest podcast, Belinda Allen and Stephen Wu from the Australian economics team discuss the recent wages and labour force data and what this means for the Reserve Bank of Australia. The Q4 22 wage price index rose by 0.8%/qtr and 3.3%/yr, below expectations of the market and the RBA and suggests there is no wage price spiral in Australia. Together with signs the labour market is loosening...

The CommBank Household Spending Intentions (HSI) index for January 2023 declined by a solid -6.9%/mth in original terms, following on from a small 0.3%/mth rise in December 2022. Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss the details of the report, and also the outlook for consumer spending given the Reserve Bank of Australia’s hawkish rate hike in February.   ...

The US FOMC continued the process of tightening monetary policy in February, but slowed the pace with a 25 basis point move. This takes the Fed Fund target rate to 4.5%-4.75%. In this podcast Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss why the slowdown in tightening and where the Fed Funds rate will go from here.   ------ DISCLAIMER ------ Before listening to thi...

Q4 22 CPI was red hot in Australia and should see the Reserve Bank of Australia (RBA) lift the cash rate in February by 25bp to 3.35%. In this podcast Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss the inflation data in detail and the implications for the RBA. The Australian economy is set to slow in 2023, although it is dependent on the policy path of the RB...

Our global economic growth forecasts have been upgraded in 2023 from 1.8% to 2.0% because of China’s early re-opening and Europe’s less severe recession. In this podcast Joseph Capurso and Kristina Clifton from our International Economics team talk to Belinda Allen, Senior Economist about the recession prediction and how central banks will need to decide when to stop lifting interest rates in 2023...

On our first podcast for 2023 Belinda Allen, Senior Economist talks to Carol Kong, Economist and Current Strategist about the reopening of China. Carol expects the reopening after close to three years of restrictions will bring forward the economic recovery, led by household consumption. However this will likely be in fits and starts due to chaotic preparation and a surge in covid cases. We expect...

The CommBank Household Spending Intentions (HSI) index rose by 1.9%/mth in original terms in November 2022, to 118.2.  The increase was driven by a rise in spending on Transport (higher petrol prices), Retail (with consumers taking advantage of the sales) and Health & fitness.  This was partly offset by falls in Travel, Education and Motor vehicles. Stephen Halmarick, Chief Economist and Belinda A...

In this podcast Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist dive into the outlook for 2023 for both the global economy and the Australian economy. Stephen highlights that central banks have in 2022 focussed on ‘today’s problem’, ie inflation, but in 2023 will pivot to ‘tomorrow’s problem’, ie the looming economic slowdown. This pivot will impact on financial markets and...

In this podcast Belinda Allen, Senior Economist, speaks with Tobin Gorey, Agri-Strategist, about the latest AgQ, Southern Exposure (published 29/11).  The podcast includes discussion about the impact of floods in Eastern Australia, how commodity prices might interact with currencies and why you should also keep an eye on the weather in South America.   ------ DISCLAIMER ------ Before listening to...

The CommBank Household Spending Intentions (HSI) Index rose by +0.9%/mth in October 2022, to 116.0.  The gains in October were impacted by higher prices in a number of categories.  Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss the results in this latest podcast and dive into the detail including the seasonal influences at play in the retail category. The most signi...

The second 2022/23 Federal Budget was handed down on 25 October 2022. The new Labor Government wanted to ensure its fiscal settings were in line with the Reserve Bank of Australia’s aim of controlling inflation. In this podcast Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss the Budget numbers, the key policy announcements and the economic projections. In short with...

We have cut our forecast for global economic growth to only 1.6% in 2023, below the International Monetary Fund definition of a global recession of 2%. In this podcast Joseph Capurso, Head of International and Sustainable Economics and Belinda Allen, Senior Economist discuss the drivers behind this view, the outlook for major central banks and the risk of stagflation. The outlook for China, the US...

For September 2022 the CommBank Household Spending Intentions (HSI) Index declined by 0.5%/mth.  The fall in September was the first monthly decline since April this year and is clearly beginning to show the effects on the household sector of the RBA’s aggressive interest rate hiking cycle – with further impact expected in the months ahead. Stephen Halmarick, Chief Economist and Belinda Allen, Sen...

Extremely high inflation combined with the FOMC’s strong commitment to restore price stability suggest it will likely induce a recession. In this podcast Carol Kong, International Economist and Belinda Allen, Senior Economist discuss if the US is already in recession and the indicators to watch going forward. Importantly the US FOMC has a poor track record in managing a soft landing so a recession...

In this podcast Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss the latest CommBank Household Spending Intentions results. The HSI Index lifted by 0.8% in August and was 15.1% higher on the year. The gains however were narrowly based in Motor vehicles, Home buying and Health & fitness. While discretionary interest rate sensitive sectors including Travel, Retail and E...

Agri-commodity prices had their most recent peak in mid-May. And by end-August were 17% below that peak. Prices though remain well above the levels in late 2020. Russia invading Ukraine has been one important, and highly-visible, influence on the swings in prices since earlier this year.  But only one. In this podcast Belinda Allen, Senior Economist and Tobin Gorey, Ag Strategist discuss the Ukrai...

We have made some changes to the speed at which we expect home prices to fall. In this podcast, Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss the revised profile for home prices.  A 15% peak to trough fall in national home prices remains the base case, but the trough is expected to be reached sooner. The conversation then turns to the current dichotomy in th...

Consumer sentiment has fallen sharply and is at very low levels consistent with major economic disruptions.  The August figure is at just 81.2 pts and in deeply pessimistic territory.  But consumption growth has so far been fairly solid.  In this podcast, Stephen Wu, Economist in the Australian Economics team and Belinda Allen, Senior Economist discuss what is driving the weakness in consumer sent...

The headline CPI rose by a very large 1.8%/qtr in Q2 22. This took the annual rate to 6.1%. Food, petrol, clothing and housing prices all rose strongly, as did holiday and accommodation prices. In this podcast Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss the CPI in detail and how this result compares in a global context. Importantly the outcome leaves us co...

The CommBank Household Spending Intentions (HSI) Index rose by a modest 0.9%/mth, taking the index back to an equal record-high of 117.3.  On an annual basis the HSI index is up 11.9% relative to June 2021.  Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss the latest results and note the gains in June were narrowly based, driven by high prices and spending on transpor...