Analysts at TD Securities note that there was mixed news from the Australian retail sales, with a decent +0.3% m/m increase, but volumes at -0.1% q/q implies (1) a terrible start for Q1 GDP and (2) that there must be price increases in there for volumes to be so soft.
Key Quotes
“Separately, Australia registered a strong trade surpluses with Feb revised up to $A5.14b and today’s release revealing the March surplus at a substantial +$A4.949b despite exports dropping -2%.”
“Our tracking for Q1 current account deficit is a thin -0.5% of GDP, the smallest since 1975, while net exports are expected to add +0.1% to GDP. Unfortunately with flattish consumer spending, our Q1 GDP tracking is pointing to only +0.3% q/q or 1.6% y/y.”
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