Quarterly Economic Update July - September 2024
File: GW Market & Economic update - Jul - Sept 2024
Duration: 03:01
Date: November 04, 2024
00:01 GW Market & Economic update - Jul - Sept 2024
00:06 The Australian economy is still growing, but things are a bit sluggish.
00:12 The Reserve Bank of Australia is being cautious with interest rates, waiting for inflation to settle before making any moves.
00:19 GDP Growth: Slowly But Surely
00:25 While the economy economy grew by 0.2% over the June quarter and 1.5% for the year, but with population growth, GDP per capita has fallen for six straight quarters.
00:32 This shows that while the economy is growing, many Australians are feeling the strain of rising living costs.
00:40 Interest Rates: Holding Steady
00:45 In September, the RBA kept interest rates at 4.35%, with the next decision in November. Unlike the US, Australia isn't expected to cut rates before Christmas,
00:52 as the RBA is focused on keeping inflation in check, even though it’s much lower than its peak in 2022.
00:59 Inflation: Better But Still Stubborn
01:04 Annual inflation rose to 3.8% in the June quarter, up slightly from March. However, underlying inflation has fallen for six quarters, down from a peak of 6.8% in late 2022.
01:11 Despite this, everyday prices remain high, continuing to squeeze households.
01:18 Households Are Tightening Their Belts
01:23 With cost-of-living pressures rising, many Australians are cutting back on travel and entertainment, and grocery spending is down by 1%.
01:30 However, spending on household goods, like furniture and appliances, increased by 4%, helping to support overall discretionary spending.
01:37 Housing Market: Prices Still Going Up
01:42 The property market is strong, with housing values rising more slowly. CoreLogic reports a 0.5% increase in the national Home Value Index in August and 0.4% in September.
01:50 Despite cost-of-living pressures, high demand is keeping prices elevated.
01:56 Jobs Market: Still Tight, But Productivity Is Falling
02:01 Australia’s unemployment rate is low at 4.1% as of June, but total hours worked rose only slightly, and productivity fell by 0.8%.
02:08 While many jobs are secure, this trend of working more for less output could raise concerns for long-term economic stability.
02:15 Global Outlook: Uncertainty Ahead
02:21 Globally, central banks are considering easing monetary policies, though the extent is uncertain. Ongoing conflicts in the Middle East, Ukraine, and northern Africa are adding instability.
02:29 Meanwhile, Asia's economy, a key trading partner for Australia, is expected to slow in 2024, potentially affecting our economic growth.
02:36 What It All Means for You
02:41 For everyday Australians, high interest rates, persistent inflation, and rising living costs make careful financial management crucial.
02:48 Mortgage holders won’t see relief soon, so households should stay mindful of their budgets as essential costs like groceries and petrol fluctuate.