The Chief Economist: She’ll Be Right: The Aussie Economy’s Hopping Ahead
In the article “She’ll Be Right: The Aussie Economy’s Hopping Ahead,” BGO's Chief Economist discusses Australia's economic trajectory as of April 1, 2025. The piece highlights a deceleration in inflation, which peaked at 7.8% in Q4 2022 and declined to 2.4% by Q4 2024, enabling the Reserve Bank of Australia (RBA) to implement its first rate cut of the cycle. Despite global trade tensions, particularly involving the U.S. and China, Australia's limited direct trade exposure to the U.S. and its balanced relationships with both major economies position it favorably. The article also notes that, while services inflation remains somewhat persistent, the overall economic outlook is optimistic, with anticipated growth near 2%.
Regarding the commercial real estate (CRE) sector, the article observes that market fundamentals across major sectors and cities remain robust, with expectations of significant improvements. The recent interest rate reductions by the RBA are projected to enhance capital market conditions, fostering increased investment opportunities. Additionally, the well-capitalized local banking industry, characterized by growing deposits and strong credit growth, is expected to further support economic expansion and bolster the CRE market.
