Australia Westpac-MI leading index rose from 1.02% to 1.71% in March. That’s the fastest growth rate since May 2021. The data are consistent with Westpac’s expectation of around 5.5% GDP growth in 2022, with more than 70% of that being concentrated in Q2 and Q3.
Westpac expects RBA to be on hold at May 3 meeting, but be prepared to move interest rate at June 7 meeting. It expects a hike of 15bps in June, with 25bps hikes at most subsequent meetings to reach 1.25% at the end of 2022. In 2023, it expects three further 25bps hikes with interest rate peaking at 2% in June.
