What happened
Westpac's Nowcast model estimates third-quarter GDP growth at 0.6% quarter-on-quarter, lifting annual growth to 2.3%. Business investment in data centres and renewable energy projects provided major support, helping stabilize economic activity after a sharp decline earlier in the year.
Why it matters here
Annual growth of 2.3% approaches trend levels and exceeds Reserve Bank targets. Because the central bank aims to engineer below-trend economic activity to bring inflation back to target, resilient momentum increases the likelihood that monetary policy will remain tight.
What to watch
The Reserve Bank's upcoming interest rate decisions and future GDP releases for confirmation of persistent business investment.
Source
westpaciq.com.au