National accounts likely to reveal a subdued economy

Poppy Johnston |

The Fair Work Commission’s minimum and award wage decision will interest Reserve-Bank watchers.
The Fair Work Commission’s minimum and award wage decision will interest Reserve-Bank watchers.

Another lacklustre result is expected when the Australian economy gets its quarterly performance review.

Wednesday’s March quarter national accounts – compiled by the Australian Bureau of Statistics – includes the gross domestic product gauge and other useful information, such as productivity growth. 

The Australian economy expanded by a meagre 0.2 per cent through the final three months of 2023, which took annual growth to 1.5 per cent over the year.

With interest rates still high enough to be slowing the economy and weighing on demand for goods and services, countering price pressures, economists are anticipating another subdued outcome.

Household consumption, which represents around half of all economic activity in Australia, is expected to drag on the headline measure, reflecting the interest-rate pain felt by mortgage holders.

Economists will firm up their forecasts following datasets on Tuesday that feed into the GDP figure, including balance of payments, business indicators and government spending.

Following a run of hotter-than-expected inflation data, the Fair Work Commission’s minimum and award wage decision is likely to be of interest to Reserve-Bank watchers.

Australian currency
The Fair Work Commission will hand down its minimum and award wage decision. (Joel Carrett/AAP PHOTOS)

The industrial umpire, due to hand down its annual wage review on Monday, will be balancing the need to support worker wages eroded by rising living costs without adding to inflationary pressures.

The Reserve Bank’s impression of the wage decision and its implications for interest rates will likely feature when senior central bankers face questions from senators in a hearing on Wednesday.

Deputy governor Andrew Hauser is also due to make his first public appearance in the role on Friday at Australia’s Economic Outlook event in Sydney.

Wall Street ended the week up higher, led by energy stocks, but the technology sector closed slightly in the red.

On Friday, the Dow Jones Industrial Average rose 574.84 points, or 1.51 per cent, to 38,686.32.

The S&P 500 gained 42.03 points, or 0.80 per cent, at 5,277.51 and the Nasdaq Composite lost 2.06 points, or 0.01 per cent, at 16,735.02.

Australian share futures gained 38 points, or 0.49 per cent, to 7757.

The benchmark S&P/ASX200 index on Friday finished up 73.5 points, or 0.96 per cent, to 7,701.7, while the broader All Ordinaries rose 74.9 points, or 0.95 per cent, to 7,970.8.