The economy expanded another 0.8 per cent through the final three months of 2023, taking annual growth to 2.8 per cent.
The Reserve Bank is forecasting the economy to grow by just 1.5 per cent this calendar year and through 2024.Data to be released on Wednesday is expected to show the economy expanded another 0.8 per cent through the final three months of 2023, taking annual growth to 2.8 per cent. Figures on Monday showed a drop in the volume of manufacturing and wholesale trade sales through the quarter but a 10.6 per cent jump in company profits, while wages and salaries increased by 2.6 per cent to be 11.
“The risk to this outlook is towards the downside and is largely dependent on how hard the RBA uses monetary policy to bring inflation back towards the target band,” he said. She said strong population growth, a tight jobs market and a lift in nominal wages would support the economy, but a per capita recession was possible.
He said a series of incidents on top of the war in Ukraine and its impact on commodity prices, global uncertainties and the RBA’s rate rises would have to occur to stop the economy from growing. “We expect a sharp slowdown in household spending this year as interest rates and inflation bite, however, we do see some resilience in spending due to the strength of the labour market, accumulated savings and rising nominal wages,” they said.