FEAR & GREED | Business News The Week Ahead | 2 June 2025
Jun 1, 2025
This week dives into key economic indicators like GDP growth and recent Consumer Price Index results. Experts analyze the potential for interest rate cuts and the challenges facing economic recovery. The discussion highlights the contrasting trends in housing prices, with Melbourne and Sydney showing signs of recovery, while other regions cool off. Insights into household spending and international trade add depth to the economic outlook.
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Inflation Within Target Range
- Australia's inflation is within the Reserve Bank's target band around 2.4% annual headline and 2.8% trimmed mean.
- Minor factors like tobacco prices and ending electricity subsidies are influencing recent numbers but overall inflation is stable.
Weak Private Sector Investment
- Private sector capital expenditure is slightly down, especially machinery and equipment, despite increased spending on buildings.
- This weak investment suggests economic growth pressure and supports potential interest rate cuts later this year.
Modest GDP Growth Expected
- Quarterly GDP growth is expected to be weak at about 0.5-0.6%, with annual growth around 1.6-1.7%.
- This growth is below Australia's typical rates, indicating a modest economic expansion currently.