March 21, 2024 by Dymphna

Building sales nosedive as container rates lift: the economy in pictures

See the world through the eyes of an economist: Approvals, sales, business confidence and container rates.

These are the charts that caught my eye this week. First up, building approvals continue to nose-dive and detached building sales remain in the gutter. There’s no signs here that we’ll be building our way out of the crisis anytime soon.

Which leaves Australia with a chronic housing shortage. The rental vacancy rate remained at record lows during the week, which correlates with super-charged rental growth. This will continue for some time yet.

The NAB Business Survey showed that businesses are pretty ambivalent about current trading conditions. They’re not bad, but they’re not good either.

That said, a growing share of employers expect to increase staff over the next three months, with very few expecting to decrease staff numbers. This should stop the unemployment rate lifting too far.

Finally, container shipping rates remain elevated. They spiked during the outbreak of tensions in the Middle East, and haven’t come back down. We’re still nowhere near Covid levels, but it does show how vulnerable the economy is to shocks. Another trade shock now could see container rates spike again, triggering a fresh round of inflation. But for now, we’re fine.

And that’s how the world looks through the eyes of an economist this week.