Westpac tips slower economic growth in 2015
Photo: Lisa Maree Williams
Westpac chief economist Bill Evans says economic growth in November marked the tenth consecutive month where it was below trend.
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Australia's economy is likely to grow at an even slower pace in 2015, a major bank says.
Westpac says it believes annual growth will be markedly below trend until the middle of 2015.
It expects gross domestic product to grow by 2.7 per cent, which is slower than a previous forecast of 3.2 per cent.
Westpac chief economist Bill Evans said economic growth in November marked the tenth consecutive month where it was below trend.
“We can expect growth in the Australian economy to stay below trend in the final quarter of 2014 and well into 2015,” he said in a statement on Wednesday.
However, Westpac anticipates growth to rise to 3.2 per cent during the second half of 2015, with an expectation the Reserve Bank will cut interest rates in February and March and the Australian dollar will weaken further.
It also expects an improvement in Australia’s dire terms of trade, the ratio of export to import prices.
The Westpac-Melbourne Institute leading index, which measures the likely pace of economic growth three to nine months into the future, fell from -0.15 per cent in October to -0.47 per cent in November.