The Reserve Bank (RBA) held their monthly board meeting earlier this week, at which they decided to keep official interest rates on hold
Official interest rates have now remained on hold at 2.0% since they were lowered by 25 basis points in May of last year.
In the statement accompanying the announcement the RBA did note the recent appreciation in the Australian dollar.
Further to this they noted that the appreciating dollar could complicate the economic adjustment which is currently underway.
The statement also notes that the low inflation reading allows the RBA scope to reduce interest rates if they feel that a reduction is appropriate.
Most economic commentators are of the view that the cash rate is likely to remain on hold for the remainder of the year, however financial markets are currently indicating a 25 basis point cut to the cash rate later this year.
The Australian Bureau of Statistics (ABS) released building approvals data for February 2016 earlier this week.
You can read a lot more about the release at the RP Data Research blog however, following are some of the key statistics.
Over the month there were 18,252 dwelling approvals which was an increase of 3.1% over the month but -9.0% lower year-on-year.
Although dwelling approvals remain at historic high levels, they have fallen by -12.1% from their record high in March 2015.
The 18,252 approvals consisted of 9,288 houses and 8,963 units approved for construction.
House approvals were -1.0% lower over the month and -5.6% lower year-on-year while the more volatile unit sector saw approvals increased by 7.7% over the month but were -12.3% lower year-on-year.
Although approvals remain at very high levels the trend shows they are slowing and we would expect that approvals will continue to fall over the coming months.
The ABS also released retail trade data this week which showed trade was unchanged in February 2016.
Despite the weak February result, retail trade was 3.3% higher over the past year with retail trade up most in the Australian Capital Territory (7.7%) followed by:
Victoria (4.8%), New South Wales (4.6%) and Tasmania (3.4%). Across the remaining states and territories, retail trade fell -0.2% over the year in Western Australia but rose in each of Queensland (1.3%), South Australia (3.0%) and Northern Territory (0.7%).
Across the different industries, the year on-year change in retail trade has been strongest for:
department stores (+7.0%), clothing, footwear and personal accessory (+6.5%) and household goods retailing (+4.4%) while it has been comparatively weak for cafes, restaurants and take-away food services (+1.8%), food retailing (+2.3%) and other retailing (+2.9%).
Auction volumes increased last week but were well below pre- Easter levels.
Over the week ending April 3 there were 1,582 capital city auctions with CoreLogic collecting results for 1,434 auctions, accounting for almost 91% of all auctions.
The final clearance rate was recorded at 66.6% which is down from the previous week and the lowest clearance rate in three weeks.
The number of auctions increased from just 554 over the previous week.
Last week, across Melbourne, typically the largest capital city auction market, 584 auctions were held with a clearance rate of 69.2% which was the cities lowest clearance rate in three weeks.
Sydney’s auction clearance rate was recorded at 69.8% across 664 auctions.
It was the cities lowest auction clearance rate in four weeks.
Across the remaining capital cities, clearance rates rose in Brisbane, Adelaide and Hobart but fell elsewhere. Auction volumes were also higher this week across all regions except Tasmania.
Note that sales listings are based on a rolling 28 day count of unique properties that have been advertised for sale.
Relative to the same period last year, the number of new listings over the past twenty eight days is -2.2% lower on a national basis and the total volume of stock on the market is -4.2% lower than a year ago.
Across the combined capital cities, new listings are -0.2% lower relative to last year, while total listings are 1.3% higher.
On a city by city basis, only Melbourne (+5.6%), Brisbane (+7.0%), Adelaide (+2.5%) and Canberra (+5.5%) are seeing a higher number of new listings than a year ago suggesting vendors remain more confident in these markets.
In terms of the total stock available for sale, only Melbourne (-6.2%), Hobart (-27.0%) and Canberra (-0.6%) have fewer total properties for sale than a year ago.
Nationally, new listings are at their lowest level in five weeks while total listings are the lowest they’ve been in eight weeks.
Across the capital cities, new listings are at their lowest level in 10 weeks and total listings are at their lowest level in seven weeks.
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