RBA Charts the COVID-19 Depression

by Chris Becker

It’s my favourite time of the month – checking out the latest content from the RBA Chart Pack! Let’s dive in….

First it’s all about the GDP’s, all in the toilet for the biggest economies as COVID-19 bites:

Meanwhile in Australia, the trend has been down for years:

And in the last quarter before the virus hit, it was all about government spending to keep things moving:

The CPI print is trending up again after a long term downtrend:

But the real driver of inflation – house prices – is slowly, very slowly rolling over as household debt continues to climb:

Credit growth has stabilised for owner occupiers but investment (sic) remains stuck in negative “growth” territory:

Meanwhile business investment remains in the toilet as a share of GDP:

In the labour market, COVID-19 has had a devastating effect:

With the real rate of unemployment still well understated and more than 12% of Australians unable to work:

Luckily commodity prices are still elevated – I guess?

Keeping our terms of trade equally elevated and keeping standards of living somewhat stable:

All because of that magic dirt – iron ore…While coal exports flatline:

Unfortunately all going to the wrong place:

On to real things like money…. Negative rates anyone?

While the spread between Oz and US government bond yields pips back into the positive zone, keeping the currency elevated:

Back to houses – with interest rates plummeting:

But banks remains well profitable thank you very much:

And margins remain tighter than a you know what:

Housing loans are non-performing and rising, even as APRA provides three monkey policy for the banks:

You can find the full Chart Pack here.

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