CommBank View: Economics & Markets

In our latest podcast we step outside the economics sphere to discuss Green bonds. Martin Whetton, Head of Fixed Income and Currency Strategy and Belinda Allen, Senior Economist discuss the growing number of sovereign and other issuers turning to Green bonds as borrowing levels increased during the pandemic. New Zealand is the most recent sovereign to announce they would issue in this space. Marty...

The RBA Board today increased the cash rate by 50bp to 1.35% as was widely expected. In this podcast Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss the decision and the accompanying Statement. Given the aggressive tightening of monetary policy over the past two months the accompanying statement was pragmatic and sensible, with a forward looking focus on infla...

The Federal Budget bottom line is tracking much better than expected at the time of the March budget. Improvements in the underling economy suggest the Budget deficit in 2021/22 could come in approx. $A40bn lower than the most recent estimate of $A79.8bn. Stephen Halmarick, Chief Economist joins Belinda Allen, Senior Economist to discuss why we have seen such an improvement and why this will be im...

Inflation is too high in the large western economies and central banks are acting aggressively to lift interest rates to bring inflation down. This will be costly to economies. In our latest podcast Joseph Capurso, Head of International Economics and Carol Kong, Associate Economist discuss the outlook for the global economy and central banks for the US, UK, Europe, Canada, China and Japan with Bel...

In our latest podcast Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss Stephen’s recent trip to the US where he met with officials from the New York Federal Reserve, US Treasury, clients and other stakeholders. The feedback includes inflation is the number one issue in the US at the moment and the US Federal Reserve is lifting interest rates aggressively to control in...

In our latest podcast Kristina Clifton, Senior International Economist and Belinda Allen, Senior Australian Economist, discuss the larger than expected RBA rate hike in June. Belinda also outlines the change in terminal cash rate projection and also the impact on economic growth and home price forecasts. The May Household Spending Intentions report showed a 2.9% lift in May after a fall in April....

High and rising food prices have become a topic of broad discussion.  In this podcast, Senior Economist Belinda Allen is joined by Agri-Commodity Strategist Tobin Gorey to discuss how we got to this point.  And why it will take some time to resolve.  Russia’s invasion of Ukraine has been an important part of the story.  An already tightening crop-supply context starting back in late 2020 though is...

The outlook for residential construction is softening with headwinds including falling demand, rising interest rates and elevated construction costs. In this latest podcast, Belinda Allen, Senior Economist and Stephen Halmarick, Chief Economist discuss the outlook for the sector, including the impact from a return of net overseas migration. Stephen also discusses a recent trip to Western Australia...

In our latest podcast Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss the implications from the change in Government. In short we retain our economic and RBA forecasts as at this early stage there is little change in policy that requires us to revisit our forecasts. There will be some policy shifts, particularly around child care, health, aged care, housing an...

The CBA Household Spending Intentions Index fell in April from a record high in March. The index was down by 3.8%/mth in April with the index printing at 112.3. In this podcast Belinda Allen, Senior Economist and Stephen Halmarick, Chief Economist discuss the drivers of April’s results including gains in Travel, Entertainment and Retail and falls in Home buying, Health & fitness and Transport. The...

It was a big week for the Reserve Bank of Australia (RBA) with the first lift in the cash rate since 2010. The RBA raised the cash rate from 0.10% and 0.35%.  The large Q1 22 CPI result was the clear catalyst for the hike.  And the RBA have gone from wanting to see inflation rise to be “sustainably within the target band” to inflation fighters in a matter of months. In this podcast Gareth Aird, He...

With all the focus on monetary policy and the upcoming hiking cycle by the RBA, the role of fiscal policy can’t be forgotten as a way to manage inflation risks. In this podcast Stephen Halmarick, Chief Economist talks with Belinda Allen, Senior Economist about how the better economic outlook, both through nominal GDP and commodity prices suggests the actual budget deficit for 2022/23 could be cons...

A strong Q1 22 inflation reading on both the headline and trimmed mean measure set the market and economists reassessing the outlook for the Reserve Bank of Australia (RBA). Headline inflation rose by 2.1%/qtr and 5.1%/yr and trimmed mean rose by 1.4%/qtr and 3.7%/yr. The cost of building a new house, petrol, tertiary education and food prices all moved higher in the quarter. We are taking the RBA...

The Household Spending Intentions Index rose by 9.2%/mth in March to a record high level of 117.1. This reading eclipsed the previous high from December 2021, showing that strong momentum in the Australian economy resumed after Omicron and seasonal factors impacted results in January and February. In this podcast Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist dive into the...

The war in the Ukraine has impacted the outlook for the Eurozone economy in 2022 due to higher gas prices and the proximity to the war. As a result we have also lowered our global GDP forecast for this year to 4.1% from 4.5%. In this podcast Joseph Capurso, Head of International Economics and Belinda Allen, Senior Economist discuss the major global themes to be aware of for 2022 as well as the key...

The 2022/23 Federal Budget was handed down on 29th March 2022. In this podcast Chief Economist, Stephen Halmarick and Belinda Allen, Senior Economist discuss the Budget in detail. Overall the Federal Government has delivered a Budget that aims to reduce cost of living pressures, focus spending on other targeted areas but also move to the second phase of the fiscal strategy, namely stabilising debt...

A recent lift in COVID cases in China and lockdowns in major cities has put the spotlight back on China’s COVID strategy and its impact on economic growth. While the Chinese economy began 2022 in a strong position, in our latest podcast Kevin Xie, Senior Asia Economist with Belinda Allen, Senior Economist outlines the risks to the outlook for growth in 2022 due to COVID, higher energy prices and s...

In our latest podcast Martin Whetton, Head of Fixed Income and Currency Strategy joins Belinda Allen, Senior Economist to discuss how Australia’s government debt position has changed over recent decades. Importantly the mind set has changed on the need for government debt caused by large fiscal injections to create demand during the pandemic.  Martin discusses how investors remain un-fazed by the...

In our latest podcast Joseph Capurso, Head of International Economics and Belinda Allen, Senior Economist delve into two big issues facing the world economy. First, Joe discusses the US FOMC and Bank of England (BoE) meetings where both central banks lifted their policy interest rates. The FOMC is expected to tighten more than the BoE and RBA. Second, Joe unpacks the possible long term implication...

  March has already been an eventful month for the Australian economy. The Q4 21 GDP data showed a large 3.4%/qtr lift in economic growth while the invasion of the Ukraine and the terrible floods on the east coast will add to the inflation pressures in the Australian economy. In this podcast Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss recent economic devel...

The CommBank Household Spending Intentions (HSI) Index rose by 1.8%/mth to 107.3 in February. Stephen Halmarick, Chief Economist and Belinda Allen, Senior Economist discuss the results with the key drivers of the lift being transport, home buying, health & fitness as well as household services. The Omicron induced weakness evident in January is disappearing as case numbers fall. The gains in Febru...

In this edition of the quarterly Agriculture podcast Belinda Allen, Senior Economist talks to Ag Strategist, Tobin Gorey about several big issues impacting the Agriculture space. Belinda and Tobin cover the tightening supply context in many agri-commodities, the price response to that tightness and the price risks in the year ahead, what impact Russia’s invasion of Ukraine is having and how the he...

In our latest podcast we dive into productivity growth in Australia. Kristina Clifton talks to fellow Senior Economist Belinda Allen about why productivity boosts real wages growth over the long term and the recent productivity history in Australia. The result is Australia’s productivity growth has slowed but a recent tick up in public and private investment are a positive sign but more needs to b...

We have shifted our central scenario for the first RBA rate hike to be delivered in June 2022, from August 2022. Gareth Aird, Head of Australian Economics and Belinda Allen, Senior Economist discuss Governor Lowe’s comments last week that prompted us to pull forward the timing for the first increase in the cash rate.  We also cover CBA’s inflation forecasts in this podcast.  We continue to expect...

The US labour market is tightening, employment costs are rising rapidly and inflation is very high. Joseph Capurso, Head of International Economics joins Belinda Allen, Senior Economist in discussing the outlook for the US FOMC and how the threshold for a 50bp lift in March has now been crossed. Joe covers the outlook for the interest rate cycle and the indicators to watch as rates are lifted.   -...