Another srhinking
Lots going on in Australia's national accounts!
The economy, as measured by GDP, shrunk by -1.9 per cent in Q3, but remained +3.9 per cent up from a year earlier.
Plenty of the year-on-year charts and graphs have looked rather wild lately, due to the hugely distorting impact of lockdowns.
Looked at quarterly, the -1.9 per cent wasn't too damaging, easily beating market expectations of a -2.7 per cent decline, though other income measures were hit harder, and hours worked fell by more than 5 per cent.
Nominal GDP took a decent knock this quarter, though it was still up by 11 per cent from a year earlier.
Strong rebound in the post
Obviously a fairly miserable set of headline numbers, then.
Generally, though, what we've seen elsewhere in the world is that when economies reopen, they reopen strongly.
There are at least three reasons why Australia should see the economy come firing back as Sydney and Melbourne get back up to speed.
Firstly, Australia is an exporter of commodities, and the key commodity prices have been running hot.
Secondly, Australia has had in place some of the most substantial stimulus measures going (perhaps in part due to the preceding mining boom shoring up government coffers).
The household saving ratio surged back up to just shy of 20 per cent in the third quarter as disaster payments kicked into gear - and more households were unable to socialise and spend - and the accumulated effect has been that households are now sitting on hundreds of billions of dollars in excess cash and deposits.
That's a huge war chest of cash ready to be spent over the coming months.
And thirdly, although fixed mortgage rates are off their lows and creeping higher, the cash rate is likely to remain stuck at the zero lower bound for some time to come, freeing households to spend big next year.
Indeed, mortgage stress is now at record lows.
