A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

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Oct 02 2014

Australia Facing Economic Challenges

With a 23-year expansion under its belt, Australia has done well, but its luck may have run out. Its unemployment rate is hovering near a 12-year high and inflation is at the upper end of the range set by the Reserve Bank of Australia (RBA). In addition, the China’s slowing growth is sapping a major driver of the Australian economy – exports. Under the circumstances, a key question is whether the Australian expansion can be sustained.

In this context, ECRI just completed an analysis on the Australian economy, based on ECRI’s array of Australian leading indexes, covering cycles in economic growth, exports, inflation and home prices. With overlapping headwinds stemming from both structural and cyclical weakness, the analysis provides critical insights into where the Australian economy is heading, which has implications for RBA interest rate policy.

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Echoes of Japan in U.S. GDI

ECRI September 22, 2014

Since Q1 2012, GDI growth has averaged under 2% a year – less than the Fed's "stall speed." More