- Westpac
Australia's retail sales stood unchanged in February, indicating consumer spending is unlikely to add as much to GDP growth in the March quarter as it did in the previous final quarter of 2015. Economists, however, had expected a 0.4% increase in the reported month. The Reserve Bank of Australia has tried to boost consumer spending over the last few years, keeping an easy monetary stance since 2011. Last year the central bank slashed the official cash rate to a record low of 2.0%. Recent data has suggested that the Australian economy is continuing to make the transition from mining investment-led growth to a broader recovery in non-mining sectors of the economy. However, retail sales data suggest the rise in consumer spending may have been only temporary, increasing the chances that the RBA might lower rates again. The RBA's next decision on interest rates is due tomorrow, with a firm consensus that the central bank will keep interest rates on hold.
Meanwhile, a separate report showed approvals for the construction of new homes rose 3.1% in February, led by a 7.6% jump in apartments, offsetting a 1.2% decline in detached houses. Over the 12 months to February, building approvals were down 9%, the Australian Bureau of Statistics reported.
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