Weekly Updates

In Australia, the RBA minutes confirmed that a split in the vote for a cash rate hike in March was about the timing, not the direction of monetary policy. Cotality average home prices rose further in March, though Sydney and Melbourne saw declines, which followed a bounce in dwelling approvals in February driven by units and townhouses.

In Australia, annual CPI inflation rates held broadly steady ahead of the escalation in the Middle East. ANZ Roy Morgan consumer confidence reached the lowest level on record last week (since 1973), while consumer inflation expectations climbed to a record high.

At home, the RBA increased the cash rate target to 4.10%, as expected, and at least another hike is fully priced in by the markets in the coming months. Employment growth in February exceeded the market consensus, while the unemployment rate saw an unexpected increase.

In Australia, hawkish comments by RBA Deputy Governor Andrew Hauser led to intensification of cash rate expectations. Westpac consumer sentiment improved a little in March, but Melbourne Institute inflation expectations spiked.

In Australia, real GDP rose largely in line with market expectations, though private consumption growth disappointed. Household spending growth rose less than expected in January.

In Australia, the January CPI inflation figures surprised slightly to the upside. Private sector capex growth decelerated in Q4, while construction work done declined marginally.