The Reserve Bank of Australia (RBA) has released its monthly Chart Pack – “a set of graphs that summarise macroeconomic and financial market trends”. After this mornings quite disappointing GDP results, let’s have a closer look at a select few interesting and relevant charts for MacroBusiness readers.
World Economy First, what will likely be our future largest export partners and arguably the two rising superpowers in Asia: China and India.
India’s economic growth, while positive and high, continues to decelerate, whilst China appears to be in the same boat, although the deceleration is a bit slower the path to “sustainable” growth, even at 7.5% is murky.
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Contrast that with the developed economies growth which although positive is well below the boom era of the last decade, and the standout is the USA (which is growing faster than Australia – WTF?) Japan remains in the doldrums, whilst Europe is heading to inevitable recession (printed -0.3% last night):
What is still the most important economic problem in Europe? Debt? No. Inflation? No. Unemployment? Yes:
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You can also plainly see that the very tight U-3 measure for the US has improved marginally, but still at multi-decade highs around 9%. If a recovery is underway and continues at this pace it will likely be the end of the decade before unemployment, in the US at least, “recovers”. But Europe looks set to having a lost generation of youth who may not know what having a job is like.
Australian Economy
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I hope new readers can understand the trend in Australian economic growth, which the National Accounts revealed this morning to be WAY below trend – something that was obvious with anyone with a ruler, an understanding of credit growth and how a sovereign government’s spending affects the economy:
If the economy is to lift itself out of this stupor, in the “biggest boom in the century”, then you’ll need to go start spending and stop saving:
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Finally, what really drives the economy? Are we all starting to finally see that its not the Holes, but the Houses. Here’s the latest ABS Dwelling Price Index (they’ve changed this month to a growth factor, not nominal prices):