It’s a pretty dour lineup of posts today so thankfully Paul Bloxham has arrived to lighten the mood. From News:
“The death of the mining boom is greatly exaggerated,” Mr Bloxham said. “We are really at the tailend of the ramp up and we have yet to see the export pick up. LNG will see a really big ramp up and that will be an enormous kick to exports.”
But he said the non-mining sector was about to rebalance the economic agenda as the negative impacts of the mining boom began to wane.
“The Aussie dollar’s effect is starting to wear off. Lower interest rates are already helping the housing market and retail sales and we think those parts of the economy will begin to take over as growth contributors. It has been above parity for 21/2 years and we think the parts of the economy held back are gradually adjusting.
But he said the benefits of the mining boom were far from over and higher commodity prices were the “new normal”. “Commodity prices are not going to go back to the levels of the 1980s, ’90s and 2000s,” Mr Bloxham said.
Urbanisation in China was running at 52 per cent of the population but it was expected to reach the same level as the US, 75 per cent, by 2050.“By 2025, China and India will have a bigger combined economy than the US and Euro area,” he said.
Good job!
He also has a new note out arguing that China’s growth still rocks (find it below). I note, however, that there is no reiteration of his call that the bottom of the rate cycle is in.
130417 Australian Economics Comment – China Recovery Modest, But Infrastructure Strong
