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Economists have updated their forecasts for Australia’s June quarter gross domestic product (GDP), which is set to be released on Wednesday. This revision comes in response to a mixed array of recent economic data, prompting several financial institutions to reassess their projections for economic growth.
UBS Group AG (UBS) has lowered its forecast for the June quarter GDP expansion to 0.2 percent quarter-on-quarter, down from its previous estimate of 0.3 percent. Similarly, ANZ Banking Group Limited (ASX:ANZ) has adjusted its expectation to a 0.1 percent growth rate, a decrease from the previously anticipated 0.2 percent. This revision would bring the annual growth rate to approximately 0.8 percent, compared to earlier predictions of 1 percent. Analysts had initially forecasted a 0.3 percent increase in GDP for the June quarter, following a modest 0.1 percent gain in the preceding three months. On an annual basis, the earlier forecast was for a 1 percent expansion, down from 1.1 percent in the 12 months to March.
Senior economist Catherine Birch from ANZ Banking Group Limited noted that despite the GDP data lagging behind more immediate indicators, such as employment growth and monthly inflation rates, the recent data is unlikely to significantly alter the Reserve Bank of Australia’s (RBA) stance. Birch emphasized that the recent uptick in employment and inflation, both of which exceeded earlier expectations, is a factor that the RBA will continue to consider in its monetary policy decisions.
Conversely, Commonwealth Bank of Australia (ASX:CBA) has revised its GDP growth forecasts upward. The bank now anticipates a 0.4 percent increase in the June quarter, a notable adjustment from its prior estimate of 0.2 percent. CBA also upgraded its annual growth forecast to 1.1 percent, from the previous estimate of 0.9 percent. This adjustment reflects a more optimistic view of the Australian economy’s performance.
National Australia Bank Limited (ASX:NAB) has similarly increased its GDP forecast, now predicting a 0.3 percent growth for the June quarter, up from an earlier expectation of 0.1 percent. NAB’s annual growth forecast has also been revised to 1.1 percent, aligning with CBA’s updated projections.
The revisions by these major financial institutions highlight the evolving economic landscape and underscore the impact of recent economic data on growth expectations. As Australia approaches the release of its June quarter GDP figures, these updated forecasts provide valuable insights into the anticipated economic performance and the potential implications for future monetary policy.
