See the world through the eyes of an economist.
Property Market Still Tight
Australia house prices edged up to new record highs in March, as the market remains chronically undersupplied. This is about the number of houses – reflected in the vacancy rate which fell in the month and remains around record lows…
But it’s also about the number of homes for sale at any given time. New listings are trending lower, and total listings remains around record lows.
The upward movement in prices may encourage more homes to market, as price movements and new listings tend to be pretty closely correlated.
Inflation is Dead
The inflation data continues to surprise to the downside, and the trimmed mean measure is tracking below the RBA forecasts. This should give them encouragement to cut.
Housing inflation continues to ease as well. In good news for builders, new dwelling cost inflation is back in normal ranges.
Retail sales softening
The retail sales data continues to come in soft. Excluding food and eating out, sales have now fallen for two months in a row.
On that, I thought the chart on food was super interesting. There was a boom in liquor sales during Covid, but it never corrected. For some reason, Covid convinced us that we just needed to drink more. Since then, liquor sales have been flat while other sales have caught up. I don’t understand this.
Frenemies
Finally, with the US going all-in on tariffs, Republican voters have been following their president in reassessing their views on their traditional allies. 27% of Republican voters now see Canada as unfriendly or as ‘an enemy’. It’s a similar level for EU. That’s pretty wild.
And that’s how the world looked through the eyes of an economist this week.
DB.