Plenty of economic data to help shape mood
Senior economist says 'challenge is how people will behave around cost pressures for households and business'.
CONSUMER sentiment and key public engagements by senior Reserve Bank of Australia officials will be closely watched by the nation’s economists.
RBA assistant governor Sarah Hunter will speak at The Australian Financial Review’s Property Summit in Sydney on Tuesday, while deputy governor Andrew Hauser appears on ABC’s 7.30 later that evening.
Westpac also releases its consumer sentiment report this week and, while not considered a hard measure, it will look at whether spending has held up or increased.
The NAB Business Survey will also drop, while the ANZ-Indeed Job Ads is set to be released on Monday.
NAB head of Australian economics Gareth Spence said he didn’t believe the central bank’s leadership would give away too much more than what they’ve already indicated.
“There’s obviously inflation pressures, then you know front of mind for the RBA is the inflation challenge, but if that’s because of volumes or actual sales, it also tells us maybe the economy isn’t slowing as much as they thought,” he said.
The US-led war on Iran, launched in February, is continuing to drag on and has caused global oil prices to skyrocket after the effective closure of one of the world’s most important oil corridors.
About one fifth of the world’s oil transits through the Strait of Hormuz.
People keen to avoid high fuel prices have rushed to purchase electric vehicles, with sales found to have stoked consumption growth in the economy in the three months to June 30.
Spence said economists were monitoring the impact of this uncertainty.
“The challenge we have very much over the next few months is going to be how do consumers and businesses kind of behave given the ongoing issues in the Middle East, the uncertainty, and kind of the cost pressures for both households and business that we’re seeing,” he said.
The Reserve Bank kept the cash rate on hold at 4.35 per cent at its last board meeting in mid-August, with the next meeting and interest rate decision to come at the end of September.
