Below trend growth to continue
No news in falling commodity prices. The big questions for 2016 are residential construction cycle and the non-mining economy. We expect RBA to be on hold right through 2016.
A fairly crazy start to 2016 although uniformity in that the directional moves in key global markets has been negative. Major stockmarket indices are down 12% in China and 8% in
Australia and the US; Oil is down $4 to US$33; US and Australian 10-year Government bond yields are down 15bps and are now lower than when the Fed hiked in December; and the AUD/USD has slid 3.5 cents to just under US 70 cents.
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