Australia Leading Economic IndexApril 2022 Data - 1960-2021 Historical

The Westpac-Melbourne Institute Leading Economic Index in Australia declined by 0.2% yoy in April 2022, the first drop since last September, after a 0.3% increase in the prior month. Meanwhile, the six-month annualized growth rate, which indicates the likely pace of economic activity relative to trend three to nine months into the future, slowed to 0.88 percent in April from 1.69 percent in March. Westpac expects that the Reserve Bank of Australia will decide to raise the cash rate by a further 40 basis points to 0.75 percent during its meeting on June 7th. "The board will also be aware of the efforts of other central banks, including the US Fed, to quickly move interest rate settings back to neutral, said chief economist Bill Evans. "It is also much more prudent to front load the increases where at a stage in the cycle when rates are clearly below what might be considered a ‘neutral’ level."

The Westpac-Melbourne Institute Leading Economic Index in Australia rose by 0.3% yoy in March 2022, after an upwardly revised 0.4% increase in the prior month and rising for the third month in a row. Meanwhile, the six-month annualized growth rate, which indicates the likely pace of economic activity relative to trend three to nine months into the future, increased by 1.71% in March, the most since May 2021, after gaining 1.02% in February, suggesting the economy will grow comfortably above the long-term growth rate of 2.8 percent. "It is very welcome to see these encouraging signals from the leading index in the early months of 2022," Westpac chief economist Bill Evans said. "They are consistent with our upbeat view of the growth momentum in the economy for most of 2022."

The Westpac-Melbourne Institute Leading Economic Index in Australia rose 0.1% YoY in January 2022, improving from a reading of no change in the previous month. Meanwhile, the six-month annualized growth rate, which indicates the likely pace of economic activity relative to trend three to nine months into the future, rose 0.4% in January 2022 from -0.1% in the previous month. The strongest positives have come from: a sharp rebound in aggregate hours worked (adding +0.6ppts to the headline growth rate since August); an associated improvement in the Westpac-Melbourne Institute Unemployment Expectations Index (+0.4ppts); and a widening yield spread (+0.3ppts). These gains have been neutralized by a softer signal from commodity prices (measured in AUD terms, –0.4ppts); slower growth in US industrial production (–0.4ppts) and the sell-off in equity markets, the S&P/ASX200 down 6.4% in January, taking another –0.4ppts off the index growth rate.