ECONOMIC FORECASTING – AUSTRALIA

Treasurer hints at lower economic growth trend

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Original article by Jacob Greber, Primrose Riordan
The Australian Financial Review – Page: 5 : 18-Nov-15

The Australian economy’s trend growth rate has traditionally been regarded as being around 3.25 per cent. Treasurer Scott Morrison says the economy is currently expanding by 2.3 per cent, but this would need to rise above three per cent for government revenue to be sufficient to balance the Budget. The Treasury has previously forecast that the Budget will return to deficit by the early 2020s, although this is based on an economic growth rate of 3.5 per cent over the five years from 2018-19.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD

Budget blowout of $5b if growth 3pc

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Original article by Jacob Greber
The Australian Financial Review – Page: 3 : 17-Nov-15

The Australian economy’s trend growth rate has traditionally been regarded as 3.25 per cent. Reserve Bank Governor Glenn Stevens and Treasury secretary John Fraser have both recently warned that the nation’s "potential" growth rate could slow in coming years. Economic modelling by PwC has concluded that a trend rate of three per cent would result in Budget revenue being around $A5bn lower than expected each year.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA. DEPT OF THE TREASURY, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY

OECD growth forecast cut to 2.6pc from 3pc

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Original article by Jacob Greber
The Australian Financial Review – Page: 8 : 10-Nov-15

The OECD has downgraded its economic growth forecast for Australia in 2015 from 2.3 per cent to 2.2 per cent. Meanwhile, the economy is expected to expand by 2.6 per cent in 2016, compared with the OECD’s previous forecast of three per cent growth. The OECD’s economic outlook report suggests that Australia’s unemployment rate will remain at around 6.2 per cent in 2016. The OECD has also urged the Federal Government to pursue tax reform, including an increase in the rate and scope of the GST.

CORPORATES
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA

IMF finds our growth near target

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Original article by Jacob Greber
The Australian Financial Review – Page: 4 : 7-Oct-15

The International Monetary Fund’s revised economic growth rate for Australia in 2015 is 2.4 per cent, which is slightly lower than its previous forecast in April. However, its forecast for global economic growth has been cut by 0.4 per cent to 3.1 per cent. The IMF’s latest World Economic Outlook has also maintained its economic growth forecasts for China in 2015 and 2016.

CORPORATES
INTERNATIONAL MONETARY FUND, RESERVE BANK OF AUSTRALIA, AUSTRALIA. DEPT OF THE TREASURY

Aussie fall below US60c may shore up economy

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Original article by Rose Powell
The Australian Financial Review – Page: 22 : 4-Sep-15

A decline in the Australian dollar is not necessarily a negative development. Deutsche Bank chief economist Adam Boyton says a weaker dollar can assist the economy in adjusting itself to a post-mining environment and help prevent it from falling into recession. Boyton predicts that the Australian currency could fall to as low as $US0.50 by the end of 2016.

CORPORATES
DEUTSCHE BANK AG, KAIZEN CAPITAL PTY LTD, HSBC AUSTRALIA HOLDINGS PTY LTD, RESERVE BANK OF AUSTRALIA, SUNCORP GROUP LIMITED – ASX SUN, WESTPAC (NZ) INVESTMENTS LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Falling profits hit economy

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Original article by Jacob Greber, Vesna Poljak
The Australian Financial Review – Page: 1 : 1-Sep-15

Company profits fell 1.9 per cent in the three months to June 2015, the fifth straight quarter of profit declines, prompting analysts to conclude the Australian economy is shrinking for the first time since the election of the Abbott Government. Despite fears new concerns about the economy could weigh heavily on investor sentiment, Treasurer Joe Hockey insisted there were positive signs and that the prospect of tax reform and the China free-trade agreement would lift spirits.

CORPORATES
DEUTSCHE BANK AG, UBS HOLDINGS PTY LTD, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN BUREAU OF STATISTICS, BLOOMBERG FINANCIAL SERVICES, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY, CITIGROUP PTY LTD, RESERVE BANK OF AUSTRALIA, STANDARD AND POOR’S ASX 200 INDEX

McKibbin says climate target at ‘high end’

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Original article by Ben Potter
The Australian Financial Review – Page: 1 : 31-Aug-15

Warwick McKibbin has defended the Australian Government’s climate change policy. McKibbin, the head of the Centre for Applied Macroeconomic Analysis at Australian National University’s Crawford School of Public Policy, said on 30 August 2015 that the Government’s emissions reduction target of at least 26 per cent from 2005 levels by 2030 would result in gross domestic product being 0.6 per cent smaller than if there were no target.

CORPORATES
AUSTRALIAN NATIONAL UNIVERSITY. CRAWFORD SCHOOL OF ECONOMICS AND GOVERNMENT, AUSTRALIAN LABOR PARTY, AUSTRALIA. CLIMATE CHANGE AUTHORITY, MINERALS COUNCIL OF AUSTRALIA

Aussie dollar steadies amid fears of limited future gains

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Original article by Vanessa Desloires
The Australian Financial Review – Page: 28 : 18-Aug-15

The Australian dollar was trading at $US0.7374 in late trade on 17 August 2015. UBS economist George Tharenou expects the local currency to continue to be under pressure due to weak commodity prices. He says the Australian dollar is likely to decline to $US0.70 by the end of 2015.

CORPORATES
UBS HOLDINGS PTY LTD, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, OZFOREX GROUP LIMITED – ASX OFX, GOLDMAN SACHS AUSTRALIA PTY LTD

Westpac tips Aussie at US70c by end of 2015

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Original article by Rose Powell
The Australian Financial Review – Page: 31 : 11-Aug-15

The Australian dollar is likely to continue to fall. Westpac expects the currency to decline to $US0.70 at the end of 2015. Westpac chief economist Bill Evans explains that the bank revised its forecast from $US0.72 to reflect lower forecast for global growth for both 2015 and 2016.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, UNITED STATES. FEDERAL RESERVE BOARD, RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, OANDA AUSTRALIA PTY LTD

RBA cuts economy’s speed limit

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Original article by Jacob Greber
The Australian Financial Review – Page: 1 & 10 : 23-Jul-15

The Australian economy’s trend growth rate has traditionally been regarded as being within the range of three to 3.25 per cent. However, GDP growth has been below the trend rate for 11 consecutive quarters, and it has been above the trend rate just three times during the last 27 quarters. Reserve Bank governor Glenn Stevens has suggested that the lower economic growth of recent years may in fact represent the nation’s new trend growth rate. This would have significant implications for government revenue, unemployment and the cost of living.

CORPORATES
RESERVE BANK OF AUSTRALIA, JP MORGAN AUSTRALIA LIMITED