Westpc’s main points:
- Leading Index growth rate lifts slightly to –0.6% in July from -0.67% in June.
- Twelfth month of negative prints, longest run in seven years (ex-COVID).
- Below-trend growth momentum set to extend into 2024.
- Some support from resilient labour market and end to rate rises.
- But significant hit coming from sharp falls in commodity prices.
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Background info on the Westpac-Melbourne Institute Leading Index, published by Westpac Banking Corporation in conjunction with the Melbourne Institute of Applied Economic and Social Research.
- The main objective of this index is to signal the likely pace of economic activity relative to trend three to nine months into the future.
- The Leading Index is calculated based on a range of economic data, including components such as:
S&P/ASX 200 index, employment indicators, dwelling approvals, commodity prices and the Australian yield spread (10-year Commonwealth Government Securities (CGS) yield minus the 90-day bank bill rate).