Melbourne Institute anticipates sluggish growth in the Australian economy continued in the June quarter
The Australian economy disappointed in the March quarter, growing by only 0.2 per cent, and 1.3 per cent over the year.
The Melbourne Institute’s first nowcast of growth for the June quarter is 0.4 per cent. This takes year-ended growth to a still well below trend 1.5 per cent.
The Westpac-Melbourne Institute Leading Index provides a signal of likely growth in the coming to three to nine months. This has recently weakened and indicates that below-trend growth will persist. As such, it appears that the improvement in Australia’s growth in the remainder of 2025 is likely to be modest.
The Melbourne Institute Inflation Gauge recently has signalled that underlying inflation has been consistent with the Reserve Bank of Australia’s target.
The RBA next meets in early July. A further easing in monetary policy at either this or the following meeting in August appears appropriate.
The Melbourne Institute Nowcast of Australian GDP uses monthly information regarding labour market conditions, housing and business lending, retail sales, housing approvals, consumer expectations, trade conditions and commodity prices to gauge current economic conditions.