Earlier this week we reported on the emerging concern among analysts that Australia’s economic momentum is stalling.
The ANZ bank is now forecasting quarterly growth at just 0.1%, which would deliver an annual rate of just 1.1%.
A major factor in this is the drag from the consumer sector. Household balance sheets are stretched, retail sales volumes have been underwhelming, and the future direction of interest rates is uncertain.
Joanne Masters, a senior economist at ANZ, has been warning about the risks of slowing consumption growth since last year. She joined us for this week’s episode of Devils & Details for a discussion of the myriad factors combining to produce the drag we’re seeing on household consumption, which accounts for more than half of Australia’s overall economic activity.
You can find the show on iTunes, or listen in below.