Will Australia’s recession be over before it started?

Will Australia’s recession be over before it started?

Life is starting to get back to normal, the lockdowns are lifting, there are people in the streets, in fact I went back to one of our favourite café’s on the weekend.

ANZ bank research show that signs continue to indicate that Australians want to get back to normal.

People are out and about, booking restaurants and looking for places to visit and searching AibBNB.

They are also searching for cars to buy and thinking about home renovation.

There were further encouraging signs that the labour market has not deteriorated materially further.

ANZ found Internet searches for “unemployment benefits” have largely returned to normal, and searches for “cancel centrelink” are still elevated after spiking in early May.

In fact, recently the OECD reported that Australia may effectively be leading the developed world out of recession, although there will be a heavy dependence on the government continuing to spend and support the economy so we don’t fall off that cliff everyone seems to be worried about.

And we’re spending more.

ANZ Bank data suggests Australians are dining, driving and beautifying.

In the week to 6 June, total ANZ-observed spending was up 4.3% year on year’

As lockdowns ease across Australia, ANZ-observed spending is drifting up in the categories of travel and dining.

ANZ-observed retail spending growth hit 19.8% y/y for the week to 6 June.

Household goods growth is slowing a little, but is still growing more than other retail categories.

In the home-related goods category, electronics and furniture are the highest growth performers, with both at 53% y/y for week to 6 June.

This is a peak so far for furniture, but the lowest growth result for electronics since mid-April.

Fashion and dining-takeaway are still slightly detracting from ANZ-observed retail spending growth (−8% and −9% y/y for week to 6 June respectively), but are much closer to normal than they were in the first week of May (−33% y/y for dining-takeaway; −35% y/y for fashion).

Beauty spending is now higher than last year.

Movement related spending is drifting up, with accommodation at −48% y/y for the week to 6 June, up from −77% y/y for the first week of May.

The petrol, car hire and other transport spending category is also better than it was a month ago.

In movement of a more personal nature, fitness equipment spending is up 52% y/y, a new peak so far.

ANZ-observed charity spending is down 2.4% y/y for the week to 6 June, but is closer to last year’s spend compared to April.

Income disruptions and the overhang of bushfire spending makes y/y growth in charity spending challenging.

Spending growth is weaker in tourism-exposed east coast states (NSW, Vic, Qld) compared to smaller states (SA, WA and Tas).

Increased use of cards over cash may have inflated the spending growth captured by ANZ-observed spending.

 

State by state spending: tourism states underperform

ANZ-observed spending in the larger, more tourism-exposed states are not growing as fast as smaller states.

Victoria is once again the lowest-performer, reflecting its stricter lockdowns.

Western Australia and Tasmania have seen the strongest total ANZ-observed spending growth for the week ending 7 June.

Western Australia has the most advanced dining-takeaway recovery, while Victoria is still down 45% y/y for the week ending 7 June.

Movement spending differs by state

Movement spending differs by state, reflecting different lockdown conditions.

Car hire is closest to normal in Western Australia (−29% y/y for week to 6 June) and furthest from normal in Tasmania (-79% y/y).

Accommodation is recovering best in South Australia (−22% y/y), while the south east (NSW, Vic, Tas) are around 56–58% y/y and Queensland is −62% y/y (see charts below).

Source: ANZ Bank – this is not personal advice and was written prepared by ANZ bank for its institutional and private banking clients.

Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on

If you’re wondering what will happen to property in 2020–2021 you are not alone.

You can trust the team at Metropole to provide you with direction, guidance and results.

In challenging times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi award winning team at Metropole.

If you’re looking at buying your next home or investment property here’s 4 ways we can help you:

1. Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family.  Planning is bringing the future into the present so you can do something about it now!  This will give you direction, results and more certainty. Click here to learn more
2. Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property.  Click here to learn how we can help you.
3. Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
4. Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.

from Property UpdateProperty Update https://propertyupdate.com.au/will-australias-recession-be-over-before-it-started/