Barnaby thinks we already know. No joke.
Australia's economy has been clobbered by a stunning collapse in export earnings in the March quarter, all but ending any prospect of interest rates rising in the next few months.
In the biggest reversal since the 1970s, export volumes dived by 9 per cent for the quarter, mainly due to the impact of summer’s natural disasters on shipments of coal and other natural resources.
Minerals and energy exports slumped by 14 per cent, and coal exports by 27 per cent.
The figures were worse than expected, and have firmed up predictions that national accounts figures to be released today will show the economy contracted in the March quarter.
Separate figures showing a drop in building approvals in April and falling house prices are pointing to more gloom in the June quarter.
Treasurer Wayne Swan was almost apologetic in Parliament over the export figures, saying the impact of the January natural disasters had been “somewhat larger than the Treasury initially estimated”.
This month’s federal the budget included a prediction by Treasury that the disasters would cut 0.75 per cent from the nation’s economic growth.
But Mr Swan said yesterday the March quarter export collapse would cut around 2.4 per cent from growth in the quarter — the largest quarterly hit on growth since at least the September quarter of 1959.
Estimates of the March quarter national accounts figure turned sharply negative. The median forecast among market economists changed from a 0.4 per cent contraction in the economy to a contraction of 1.1 per cent — which would be the worst quarterly figure since the early 1990s recession...
The ANZ and Commonwealth banks are forecasting a GDP figure of minus 1.5 per cent, Westpac minus-1.0 per cent, and the National Australia Bank minus 0.3 per cent.
The forecasts imply full-year economic growth of just 1 per cent, which would be worse than the figures recorded during the global financial crisis.
Before yesterday’s export figures, financial markets were pricing in a slim chance of an interest rate hike when the Reserve Bank board meets next Tuesday. Now they are pricing in a zero probability of a rise at that meeting, and a negligible probability until November.
“The risk of a near-term rate hike has been snuffed out,” said CommSec economist Craig James. “So unquestionably poor is the news it raises real doubts about the true state of the Australian economy.”
“The Reserve Bank holds to the belief that the economy will rebound later in the year, but you don’t get a sense of that from the data.”
Separately-released statistics on building approvals showed residential approvals down 1.3 per cent in April, led by a 3.5 per cent slide in approvals for houses. It was the fifth fall in six months.
Excluding Queensland, where rebuilding is underway after the January floods and cyclone Yasi, new dwelling approvals fell by 5.6 per cent.
The RP Data-Rismark home value index showed that the value of capital city homes fell more than 1 per cent in the three months to April, with prices in Sydney down 0.5 per cent, Melbourne prices down 0.8 per cent and Perth and Brisbane down 3 and 3.1 per cent.
RP Data research director Tim Lawless said the most expensive suburbs dragged the market down, losing 5.4 per cent of their value in the past 12 months. Prices in the cheapest suburbs hardly moved.
Reserve Bank data yesterday also showed that credit activity was flat in April, with demand from business and personal loans, aside from mortgages, declining.
The March quarter national accounts figures will be released at 11.30am today.
Published in today's Age and SMH
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