Capital Economics: House price correction to squash GDP

Tuesday 30 October 2018

Via Capital Economics:

Households responded to rising house prices by lifting spending and we think they will eventually respond to falling prices with lower spending.

Across the nation, the household saving rate has fallen as wealth has surged.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.