RBA predicts a slump in Australia’s economic growth while NAB predicts good businesses are going to flourish

Amidst expectations that the most intense period of interest-rate hikes in decades will eat further into the already subdued growth, Nab believes good businesses are going to flourish again.

There’s a resilience in this economy that you’re not seeing in other economies around the world. The economy had to slow down, however, due to the scourge of inflation. And this means households have to stretch their budgets further by cutting back on discretionary spendings, so they cope with harder conditions.

Individuals are struggling with interest rates up, the cost of living is up. Everything is up! We’ve just got to get them through because in another nine months this economy will kick again.This is the luckiest country in the world, and we’ve got great businesses and is deserves our consistent support.

We are a relationship-led benchmark non-bank lender, we take the time like we have for nearly 100 years to understand when our finance clients have ambition to grow with our private funds.

The prospects of a recession, are still real but the cause is different to any previous recession and its impact and term may be short not long. Australia presently remains well-placed to absorb a policy-induced economic slowdown compared to the rest of the world, due to low unemployment, strong demand for the country’s natural resources, and with migration set to return.

The RBA is expecting growth to decline to its lowest level in three decades, excluding the pandemic, with GDP predicted to lift by a mere 0.9% (down from 1.2% previously forecast) in the 12 months to the end of 2023.

RBA believe the subdued 2023 growth in economic activity has improved the balance between supply and demand. Consumer spending has slowed considerably over the past year as cost-of-living pressures, the rise in interest rates and the earlier decline in housing prices all weighed on demand.

“Despite slower growth, the level of economic activity in Australia is still around its pre-pandemic trend.” – RBA

Growth in the economy is expected to remain subdued over the period ahead, reaching a trough of around 1 per cent at the end of 2023, before gradually picking up to around 2.25% by the end of 2025.”

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