Economy Expected To Grow Near Trend
November 15th, 2011
THE outlook for economic growth appears good, even though a measure of current economic activity is well below long term trends, a survey shows.
The Westpac/Melbourne Institute Leading Index, which indicates the likely pace of economic activity three to nine months into the future, was 3.3 per cent in September, close to its long term trend of 3.2 per cent.
Westpac chief economist Bill Evans said recent official national accounts data had imposed a degree of volatility on the index.
"Accordingly it is too early to embrace the current signal from the leading index that growth will surge above trend in early 2012,'' Mr Evans said.
The level of the index of economic activity fell one point (down 0.3 per cent) in September.
The annualised growth rate slowed to 3.3 per cent and remains slightly above its longer term trend, Westpac said.
The annualised growth rate of the Coincident Index which gives a pulse of current activity, was 0.9 per cent - well below its long term trend of 2.7 per cent.