In November 2018, our wisdom of the masses tracking survey indicated an increase in the likelihood of a severe economic slowdown. At that time the Reserve Bank of Australia was predicting 3.5% growth in 2019 and the federal government was nearly as optimistic. The Reserve Bank lowered their forecast to 3% only in February 2019.
As of 6 March 2019, we know that the economy slowed significantly in the December 2018 quarter to be only 2.3% higher than a year earlier. There is little comfort across a range of indicators that there will be any improvement in the March 2019 quarter.
On a quarter-to-quarter seasonally adjusted basis, Australia is now in a per capita economic recession for the first time since 2006.
Consumers are at the beating heart of the economy – both on the demand and supply sides. If we want to know what is going on, we should track their views. In aggregate, they will be more accurate than the experts!
See my wisdom of the masses expectations for 2019 for more information.