Business survey weakens
NAB's Business Survey is one of the best real-time indicators of what's going on in the economy, and the November survey flagged badly across most measures.
The reading for business conditions dropped from 7 to 2 since last month, while the reading for business confidence slumped from 5 in October to a negative reading of -3 for November.
Source: NAB
Retail price pressures also eased.
This follows on from a string of weaker than expected economic data, including for GDP growth and wage prices.
In Canada, the unemployment rate steepled alarmingly to 6.8 per cent last month, as a result of the slowing economy and high population growth.
This sort of spike is what Australia will definitely want to avoid - and to date it has, with the unemployment rate remaining low, largely thanks to a rapid increase in jobs in the public sector, healthcare, and NDIS roles, with government spending measures surging to record highs.
Rates on hold in December
The Reserve Bank of Australia left the cash rate target on hold in December as expected at 4.35 per cent.
However, the tone of the statement and subsequent media conference was markedly more relaxed about inflationary pressures than before.
The 3-year government bond yield fell to sit about 13 basis points below where it was yesterday.
After the announcement and media conference today, OIS pricing for the upcoming Reserve Bank meetings has shifted quite markedly.
A rate cut in February is priced as about a 2 in 3 chance, with a full cut price in by April, and two cuts by May.
This will be welcome news for property market participants, with the prospect of lower mortgage rates likely to provide some support for activity and construction in 2025.
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