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Bill Evans, analyst at Westpac, points out that the Australia’s six month annualised growth rate in the Westpac- Melbourne Institute Leading Index, fell from -0.37% in January to -0.56% in February.

Key Quotes

“The Index has now registered three consecutive months in which the growth rate has been negative. This is a strengthening signal that growth through the first two to three quarters of 2019 is likely to be below trend.”

“The signal from the Index is certainly consistent with the weak momentum in the second half of 2018 revealed in the print of the December quarter national accounts. In the second half of 2018 growth momentum slowed to an annualised pace of 1% from a 4% pace in the first half of the year.”

“Westpac expects growth in the Australian economy in 2019 to be around 2.2% – significantly below trend which is generally assessed as 2.75%.”

“The Index growth rate has shown a significant deterioration over the last six months, declining from +0.47% in September to -0.56% in February.”