U.S. factory activity, construction spending unexpectedly fall By Reuters


© Reuters. FILE PHOTO: A General Motors assembly worker loads engine block castings on to the assembly line at the GM Romulus Powertrain plant in Romulus,

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. factory activity contracted further in November amid a slump in new orders while construction spending unexpectedly fell, offering cautionary notes on an economy that had recently shown signs of growing at a moderate pace.

The reports on Monday came on the heels of upbeat October data on the goods trade deficit, housing and manufacturing that led economists to boost their gross domestic product estimates for the fourth quarter.

The Institute for Supply Management (ISM) said its index of national factory activity dropped 0.2 point to a reading of 48.1 last month. A reading below 50 indicates contraction in the manufacturing sector, which accounts for 11% of the U.S. economy.

The ISM index needs to break below the 42.9 level to signal a recession in the broader economy. Economists polled by Reuters had forecast the index rising to 49.2 in November from 48.3 in the prior month.

Though the ISM said business sentiment had improved, likely as the United States and China inch towards a partial trade deal, November’s reading marked the fourth straight month that the index remained below the 50 threshold.

Continued contraction in manufacturing could put the Federal Reserve in a difficult policy position. The U.S. central bank in October cut interest rates for the third time this year and signaled a pause in the easing cycle that started in July when it reduced borrowing costs for the first time since 2008.

Economists say without a complete trade deal, manufacturing is unlikely to rebound much and the sector could remain under pressure, with President Donald Trump on Monday restoring tariffs on steel and aluminum imports from Brazil and Argentina.

Manufacturing is also facing challenges from a domestic inventory bloat, slowing profit growth and weak overseas demand.

The ISM’s forward-looking new orders sub-index fell to a reading of 47.2 last month from 49.1 in October. A measure of export orders dropped 2.5 points to a reading of 47.9. The survey’s factory employment index fell 1.1 points to a reading of 46.6 last month.

The dollar was trading down against a basket of currencies, while U.S. Treasury prices rose. Stocks on Wall Street fell.

WEAK CONSTRUCTION

In a separate report on Monday, the Commerce Department said construction spending dropped 0.8% as investment in private projects tumbled to its lowest level in three years. Data for September was revised to show construction outlays declining 0.3% instead of rising 0.5% as previously reported.

Economists had forecast construction spending gaining 0.4% in October. Construction spending increased 1.1% on a year-on-year basis in October.

In October, spending on private construction projects dropped 1.0% to $956.3 billion, the lowest level since October 2016, after declining 1.1% in September. It was held down by a 0.9% decrease in spending on private residential projects. Outlays on residential construction dropped 1.1% in September.

The second straight monthly drop in residential construction is despite lower mortgage rates.

Mortgage rates have declined as the Federal Reserve has cut interest rates three times this year, softening the hit on the economy from a 16-month trade war between the United States and China, as well as slowing global growth.

Spending on private nonresidential structures, which includes manufacturing and power plants, plunged 1.2% in October to the lowest level since January 2018.

Investment in private nonresidential structures fell 1.0% in September. Outlays on private nonresidential structures have been depressed by a manufacturing downturn due to trade tensions and cheaper energy products.

Investment in nonresidential construction fell at its steepest pace in nearly four years in the third quarter. That contributed to business investment contracting for a second straight quarter.

Spending on public construction projects slipped 0.2% after jumping 1.9% in September. Spending on state and local government construction projects fell 0.3%. It surged 2.0% in September.

Outlays on federal government construction projects increased 0.6% in October to the highest level since May 2013. That followed a 0.7% rise in September.



China’s factory activity unexpectedly returns to growth in November By Reuters


© Reuters. FILE PHOTO: Employee works at the production line of aluminium rolls at a factory in Zouping

By Yawen Chen and Se Young Lee

BEIJING (Reuters) – Factory activity in China unexpectedly returned to growth in November for the first time in seven months, as domestic demand picked up on Beijing’s accelerated stimulus measures to steady growth.

But gains were slight, and export demand remained sluggish. More U.S. tariffs are looming within weeks and Beijing and Washington are still haggling over the first phase of a trade deal.

With China’s economic growth cooling to near 30-year lows and industrial profits shrinking, speculation is mounting that Beijing needs to roll out stimulus more quickly and more aggressively, even if it risks adding to a pile of debt.

The Purchasing Managers’ Index (PMI) bounced back to 50.2 in November, its highest since March, China’s National Bureau of Statistics (NBS) said on Saturday, above the 50-point mark that separates growth from contraction on a monthly basis.

The result compared with 49.3 in October. A Reuters poll showed analysts expected the November PMI to come in at 49.5.

The official factory gauge pointed to an improvement in China’s vast manufacturing sector last month. Total new orders bounced back to expansionary territory with the sub-index rising to 51.3, the highest level seen since April.

That indicates domestic consumption firmed up after Beijing repeatedly urged local governments to kick stimulus up a gear to meet economic goals before year-end. Factory output also rose to 52.6 in November, marking the strongest pace since March.

“In the short term, we may have already passed the low point where the economy hit the bottom,” Zhang Deli, a macro analyst with Lianxun Securities, wrote in a note.

Beijing has front-loaded 1 trillion yuan ($142 billion) of a 2020 local government special bonds quota to this year and has urged that they be issued and used as early as possible to boost infrastructure investment. Some analysts say that could be a sign that the government is worried about downward economic pressure.

Zhang attributed to the better-than-expected November PMI to a government push on infrastructure investment, less property market control, and a de-escalation in U.S.-China trade tension in October, when both sides said they had substantially reached a “Phase 1” agreement and the United States delayed a tariff increase scheduled to take place on October 15.

RISING UNCERTAINTIES

But recent developments underscore rising uncertainties in the trade conflict, which bodes ill for the outlook for external demand. New export orders fell for an 18th straight month in November, albeit at a slower pace, with the sub-index rising to 48.8 from 47.0 in October.

U.S. President Donald Trump said this week that the world’s largest economies are close to reaching agreement on the first phase deal. But trade experts and people close to the White House said it could slide into the new year, given China is pressing for more extensive tariff rollbacks.

An additional 15% in U.S. tariffs are scheduled to take effect on about $156 billion of Chinese products on Dec. 15.

Trump has also highlighted Washington’s support for protesters in Hong Kong, potentially a huge sore point for China.

The PMI survey also indicated factories continued to cut jobs in November despite slightly improved business confidence, while it signaled a further deterioration in profits for Chinese manufacturers, with output prices falling into a three-month low.

Beijing’s drive to guide more bank lending towards small private firms appeared to be working. Their PMI index recorded the strongest gain in November, compared to medium-sized and large firms, but their performance was still the poorest of the three at 49.4.

Growth in China’s services sector also quickened in November, while construction activity held up well, but growth in the latter slowed compared to the previous month, a separate statistics bureau survey showed.

The official non-manufacturing PMI picked up to 54.4, recovering from October’s 52.8, the lowest point since February 2016.

A strong services sector has offered Beijing some cushioning effect as manufacturers face growing difficulties in securing demand both at home and abroad. However, the sector’s resilience weakened late last year amid a broader economic slowdown.

Some analysts have also cast doubt over the prospects for robust growth in the construction sector.

“After all, we are still waiting for more definitive signs of a recovery in the credit cycle. Meanwhile, sentiment in the property market continues to cool down, which clouds the outlook of the sustainability of property investment growth,” researchers from China International Capital Corporation (CICC) said in a note this week.

China’s gross domestic product growth is expected to slow to a near three-decade low of 6.2% in 2019 and then hit 5.9% in 2020, according to a Reuters poll.



Oil Prices Slip After Inventories Rise Unexpectedly By Investing.com


© Reuters.

Investing.com – Oil prices fell Wednesday after the U.S. government reported a rise across the board and petroleum product stockpiles.

WTI futures fell 1% at 11:30 AM ET (16:30 GMT).

Global benchmark dropped 0.85%.

The EIA said rose 1.572 million barrels for the week ended Nov. 22, compared with analysts’ expectations for a decline of 418,000, according to forecasts compiled by Investing.com.

“While imports did go up a little, refining is steady at near 90% of capacity,” Investing.com analyst Barani Krishnan said. “So, as much as the bulls would like to create a narrative here, they haven’t got the numbers yet for it.”

“After last week’s slight miss on the crude build numbers, this week, the market has completely missed the direction on the crude storage,” Krishnan said.

jumped by about 5.1 million barrels, versus expectations for a rise of about 1.2 million barrels. were in line with a rise of 725,000 barrels, compared with forecasts for a rise of 750,000 barrels.

“To me, the more important numbers to watch are the distillate stockpiles, which are up for the first time in 10 weeks, indicating that perhaps the worst of the crunch from IMO 2020 (reducing marine sector emissions) may be ending,” Krishan said.

“Of course, none of these fundamentals might matter if the market remains obsessed with the trade deal, which Trump says are in their “final throes”, whatever that is supposed to mean,” he added.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Canada unexpectedly lost jobs in October as labor market stagnated, unemployment rate steady at 5.5% By Reuters


© Reuters. People wait in line for resume critique and career assessment sessions at 2014 Spring National Job Fair and Training Expo in Toronto

By Kelsey Johnson

OTTAWA (Reuters) – The Canadian job market stagnated unexpectedly in October, losing 1,800 net positions, while the unemployment rate remained at 5.5%, Statistics Canada said on Friday, as employment declined in the manufacturing and construction sectors.

Analysts in a Reuters poll had forecast a gain of 15,900 jobs in October and an unemployment rate of 5.5%. Wages for permanent employees rose by 4.4%, Statscan said.

Canada lost 16,100 full-time positions last month, but gained 14,300 part-time jobs. The number of self-employed workers in October fell by 27,800.

The Canadian dollar weakened to a three-week low of $1.3232 to the U.S. dollar, or 75.57 cents U.S., after the jobs data was released.

“It definitely runs against the grain of very strong job gains we’ve seen through most of the past year,” said Doug Porter, chief economist at BMO Capital Markets, noting there was likely a “small, temporary boost” because of hiring tied to last month’s national election.

“We have to be cautious about reading too much into any one report, but it shows that the economy is not simply on a one-way trip north here,” Porter said.

Canada’s central bank, which has not moved since October 2018 even as its counterparts – including the U.S. Federal Reserve – have eased, held firm as expected last week, but left the door open to a possible future cut to help the economy weather the damaging effects of global trade conflicts.

The Bank of Canada said it would monitor “the extent to which the global slowdown spreads beyond manufacturing and investment” going forward while watching domestic data.

“I don’t think one number will move the needle a whole lot at the Bank of Canada, but at the margin it’s a little bit more of a cautious signal,” Derek Holt, vice president of capital markets economics at Scotiabank, said of the jobs report.

Statscan said the services sector gained 39,000 jobs in October, with increases reported in public administration, as well as finance, real estate, insurance and rental leasing industries, while the goods-producing sectors saw a decline of 40,900 jobs on losses in manufacturing and construction.

The country’s manufacturing sector lost 23,100 jobs in October, mostly located in Ontario, while the construction sector lost 21,300 positions across five provinces, Statscan said.

In a separate release, Statistics Canada said the value of Canadian building permits dropped by a larger-than-expected 6.5% in September to C$8.3 billion ($6.28 billion) because of declines in the residential sector.



Two BOE Members Unexpectedly Vote for Rate Cut as Outlook Sours By Bloomberg


© Reuters. Two BOE Members Unexpectedly Vote for Rate Cut as Outlook Sours

(Bloomberg) — The Bank of England is growing increasingly concerned about Brexit uncertainty and the global slowdown, pushing two policy makers to unexpectedly vote for an interest rate cut.

Michael Saunders and Jonathan Haskel wanted to lower the by a quarter point — the first votes for looser policy since 2016 — citing threats to the outlook and signs of a turn in the labor market. While the majority, including Governor Mark Carney, voted to keep the rate at 0.75%, they signaled that a further deterioration could see more policy makers support easing.

“If global growth fails to stabilize, or if Brexit uncertainty remains entrenched, monetary policy may need to reinforce the expected recovery,” officials said in the summary of the meeting, published Thursday.

The declined after the announcement, and was 0.2% lower at $1.2827 as of 12:05 p.m. London time.

The comments show the BOE is shifting closer to other central banks, such as the Federal Reserve and the European Central Bank, which have already cut interest rates this year. Still, signs of easing in the China-U.S. trade tensions on Thursday could be good news for the global economy and mean less chance of a worse scenario emerging.

While Saunders had been mentioned as a possible dissenter this month, Haskel’s vote for a cut is a surprise.

The BOE also said that if the risks don’t materialize, their previous guidance that limited and gradual hikes may be needed still stands.

In their re-branded Monetary Policy Report, officials cut their forecasts for growth and inflation. The projections highlight the impact of the global slowdown, with external factors accounting for most of the downgrade.

New Assumptions

The new forecasts are now also underpinned by a new assumption for Brexit, after U.K. prime minister Boris Johnson secured a new deal with the EU. The outlook is predicated on an “orderly transition to a deep free trade agreement” similar to the Comprehensive Economic and Trade Agreement in place between the bloc and Canada.

While a large amount of uncertainty remains, a major effect of the new assumptions is that the BOE is girding for greater impact within its forecast period. It previous based its forecasts on a less precise adjustment taking place over “many years.”

Based on market pricing for one rate cut over the next three years, the BOE now sees 2020 growth at 1.2% — which would be the worst since 2009 — from 1.3% previously, and the following year at 1.8%, down from 2.3%. The level of GDP will be 1% lower at the end of the forecast period than expected in August.

Officials now see far weaker inflation in the near-term thanks to a drop in energy prices, and it will remain below target until late 2021.

The U.K. is headed for a general election in December, and the country’s deadline to leave the EU has been postponed until Jan. 31. While Brexit is dominating the economic outlook, there’s also no escaping the slowdown in global growth.

The BOE devoted a whole section to trade protectionism and the global outlook. The trade dispute between the U.S and China has caused a fundamental shift in policy after a 50-year trend towards liberalization, boosted uncertainty and weighed on growth, the BOE said.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Vietnam Oct. Exports Unexpectedly Fall as Coffee Sales Drop By Bloomberg



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Vietnam’s exports dropped 0.8% in October compared to the prior year — far below expectations for 10% growth in a Bloomberg survey of economists –as shipments of phones, and coffee fell, according to data from the General Statistics Office in Hanoi.

Overseas coffee sales in October were 100,000 tons, down 27% from a year ago, as farmers held off selling beans with prices at their lowest in a decade. In addition, Samsung Electronics (KS:) Co. reduced its phone and accessories shipments between September and October, the government said. There were also significant declines in Vietnamese exports of crude oil and steel.

Imports jumped 3.5% in October from a year earlier. Exports for January through October were estimated at $217 billion, up 7.4% from the year-ago period, after the country reported a 8.2% increase in exports for January through September, the government said.

(Updates with decline in overseas coffee sales in 2nd paragraph.)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Canadian Wholesales Unexpectedly Decline on Weak Machinery Sales By Bloomberg


© Reuters. Canadian Wholesales Unexpectedly Decline on Weak Machinery Sales

(Bloomberg) — Canada’s wholesalers posted a surprise decline in August as machinery and equipment sales pulled back.

Canadian wholesales fell 1.2% in August, Statistics Canada reported Wednesday from Ottawa. That missed the 0.3% gain that economists surveyed by Bloomberg were expecting.

Decreases were widespread, with five of seven subsectors declining. Stripping out price effects, wholesale volumes fell 1.3% from July.

Machinery and equipment fell for the second month in a row, leading declines and falling 2.6% in August. Construction, forestry, mining, and industrial machinery and equipment were the main downside contributors. A continued slowdown in these sectors may be worrying signal when it comes to the investment outlook in Canada.

Wholesale inventories also fell for the first time in a year, down 0.3% in August. Still, the inventory-to-sales ratio ticked up to 1.45, remaining at one of the highest levels since the early 1990s — a possible risk to future growth prospects.

©2019 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China unexpectedly keeps LPR lending benchmark unchanged, but outlook for rates down


SHANGHAI (Reuters) – China on Monday unexpectedly kept unchanged its new benchmark lending rate, suggesting Beijing is keen to avoid overly loosening monetary policy for fear it may push up already-high debt levels across the economy.

FILE PHOTO: Headquarters of the People’s Bank of China (PBOC), the central bank, is pictured in Beijing, China September 28, 2018. REUTERS/Jason Lee

The one-year Loan Prime Rate (LPR) CNYLPR1Y=CFXS remained at 4.20%, steady from the previous monthly fixing. The five-year LPR CNYLPR5Y=CFXS was fixed at 4.85%, unchanged from September.

A Reuters poll last week had forecast the rate would be cut again following reductions in August and last month.

Frances Cheung, head of Asia macro strategy at Westpac in Singapore, said Monday’s decision does not point to an end to the downward adjustment in the LPR.

“That said, the outcome is likely to reinforce the somewhat risk-on sentiment today,” Cheung said.

“Looking ahead, we still see each monthly LPR re-set as providing an opportunity for a baby-step reduction.”

Investors in China’s financial markets took the rate decision in stride. Benchmark 10-year treasury futures for December delivery CFTZ9, the most-traded contract, were barely moved after the data release.

A separate Reuters poll of 83 analysts showed that the central bank is expected to slash the one-year LPR to 4.00% by the end of 2019, down by 20 basis point from its current level.

The decision to keep the LPR steady came just days after China reported its third-quarter gross domestic product (GDP) growth cooling to near 30-year low.

Economists and China observers say a recent bath of weak data showing a further loss of momentum in the world’s second-biggest economy underlined the need for further monetary policy support.

A bruising 15-month long Sino-U.S. trade dispute was also one of the key factors fueling the easing expectations. U.S. President Donald Trump has outlined the first phase of a deal to end a trade war and suspended a threatened tariff hike, though officials on both sides said much more work needed to be done.

All the same, some policy insiders have said the room for the government to step up stimulus measures could be limited by its worries about rising debt risks and possible property bubbles.

Data earlier on Monday showed new home prices in China grew at a steady pace in September, with fewer cities reporting price gains, giving the authorities some breathing room as they refrain from over-stimulating the property sector.

Beijing has leaned more heavily on fiscal stimulus to address the current downturn, announcing trillions of yuan in tax cuts and special local government bonds to finance infrastructure projects.

Monday’s fixing was the third since the People’s Bank of China (PBOC) unveiled the new lending benchmark, which is set by 18 banks.

The new LPR is linked to the rate on PBOC’s medium-term lending facility (MLF), which is determined by broader financial system demand for central bank liquidity. The one-year MLF rate, last cut in February 2016, now stands at 3.3%.

The PBOC unexpectedly injected 200 billion yuan ($28.29 billion) through MLF loans last week while keeping the lending rates unchanged.

Reporting by Winni Zhou and Andrew Galbraith; Editing by Shri Navaratnam



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U.S. Consumer Sentiment Unexpectedly Rises to Three-Month High By Bloomberg


© Reuters. U.S. Consumer Sentiment Unexpectedly Rises to Three-Month High

(Bloomberg) — Sentiment among American consumers posted a surprise jump in October amid expectations for rising incomes and lower inflation, indicating households will continue to extend the longest-running U.S. expansion.

The University of Michigan’s preliminary sentiment index advanced to a three-month high of 96 from September’s 93.2, data showed Friday. The median estimate of economists was for a decline to 92. The gauge of current conditions climbed to the highest level this year while the expectations index improved.

  • Even with the improved sentiment, lower inflation expectations — closely monitored by the Federal Reserve — could lend more support to a third straight interest-rate cut later this month. Inflation expectations over the next five to 10 years dropped to 2.2% in October, the lowest level in records back to 1979, from 2.4% a month earlier.
  • The second-straight advance in sentiment is just the first back-to-back gain since March. While consumers continue to enjoy steady job and income growth, concerns about the economy’s prospects in light of the trade war continue to linger though lessened slightly in October, according to the report.
  • The report showed a widening gap between consumer expectations by political party, with Republicans growing more confident and Democrats’ sentiment the weakest since October 2008. Overall, “the impeachment inquiry has not had a significant negative impact on economic prospects,” the report showed.
  • Consumers’ outlooks of their inflation-adjusted incomes increased to the “most favorable level in two decades,” the report showed, helping to boost buying plans. Views of the economic outlook showed more modest expectations, with some expecting a slight uptick in the unemployment rate.

“Overall, the data indicate that consumption spending will be strong enough to offset weakness in business investment spending so as to keep the economy expanding into 2020,” Richard Curtin, director of the University of Michigan consumer survey, said in a statement.

Consumer expectations for inflation in the year ahead dropped to 2.5% — matching the lowest since late 2017 — from 2.8%. A measure of buying conditions for big-ticket durable goods increased to a four-month high of 160.One caveat in the report: About one-third of consumers expected unemployment to rise, compared with 20% anticipating a further decline and 46% seeing no change.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Australian Mortgages Unexpectedly Surge in Latest Recovery Sign By Bloomberg



(Bloomberg) — Australian mortgage approvals surged by the most in four years in July in the latest sign that back-to-back interest rate cuts are reviving a previously dormant property market.

Home-loan approvals rose 4.2%, the biggest increase since June 2015 and almost triple economists’ forecasts, the statistics bureau said in Sydney Monday. The spike reflects a revival in house prices that last month jumped by the most in 2-1/2 years, as well as a surge in auction clearance rates.

A combination of Reserve Bank rate cuts in June and July to a record-low 1% together with government tax relief and incentives for first-home buyers is filtering through the property market. RBA chief Philip Lowe is easing policy to try to entice households — laboring under record debt with weak wage growth — to reopen their wallets.

Consumption accounts for three-fifths of Australia’s economy and wealth effects from rising property prices should also encourage spending.

The data showed that mortgages to first-time home buyers rose for a fourth straight month. The value of loans to investors jumped 4.7%, the most since 2016, and soared 5.3% for owner-occupiers in the biggest leap since 2015.

Economists and money markets reckon Lowe will cut twice more to 0.5%, which would be close to the lower bound for rates and open up the prospect of unconventional policy. Further reinforcing those expectations is that the RBA’s quarterly forecasts released last month were based on market pricing.

Australia’s economy grew at the slowest annual pace since the 2009 worldwide recession in the second quarter.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.