Aussie economy rebounds in full!

Boomtime!

Another strong quarter for GDP growth, with another 1.8 per cent growth in Q1, following on from the strong rebounding growth seen in Q4 of last year. 

Real GDP was up 1.1 per cent on the year, but other income measures have been much stronger, up powerfully by 5-6 per cent from a year earlier.

Nominal GDP has been phenomenally strong, now up 4 per cent from a year ago.

Next quarter growth will probably in the 12-13 per cent range due to the base effect!

An easier way to look at this is to look at the GDP in current prices terms by the quarter, with nominal GDP comfortably now sitting at all-time highs.

The terms of trade figures were very, very bullish.

Meanwhile interest payable on dwellings fell all the way back to where things were at 15 years ago, which is remarkable given the huge growth in the population and the the dwelling stock over that time period.

No wonder dwelling prices are set to rise given the massive improvement in serviceability. 

Separately the RBA's Chart Pack showed the household debt to income ratio continuing to decline, now down to below 1.8x as more households have taken the opportunity to deleverage or pay down debt.

On top of the stimulus, then, we have now have real strength in nominal GDP which can flow through to household incomes. 

Hallelujah! 

---

It looks like the Reserve Bank might be getting set to make a change by not rolling over yield curve control to the November 2024 bond, potentially extending QE by a further $100 billion.

The RBA Governor is scheduled to give a presser after the July Board Meeting.

The last time this happened in November 2020 the OCR was cut to 0.10 per cent.

(h/t @MrMacroMarkets and @KitLowe)