The recent unexpected rise in Australia’s building approvals is a bit of a head fake and that approvals will show a clearer softening trend into year-end, Matthew Hassan, an economist at Westpac Institutional Bank, said.
Total number of building approvals climbed 1.5 percent monthly in September, following a 0.1 percent slight rise in August, data from the Australian Bureau of Statistics showed on November 2.
“We had been looking for some softening in non-high rise approvals which had been firming over the last four moths, and for further weakness in high rise,” the economist observed.
Instead the breakdown showed another modest gain for non-high approvals, while high rises recorded a 20 percent jump.
Due to volatility in monthly data, Westpac started using 3-month averages as the ‘benchmark’ measure, changing the table and charts accordingly, but still referring to the latest monthly figures where appropriate.
For September, the 3-month average continued to show a moderation after a lift mid-year with the quarterly growth rate tracking back to 5.1 percent.
“Approvals are still down materially on the same period last year, by 9.5 percent, with all of the fall coming from an estimated 37 percent drop in ‘high rise’ approvals,” the economist pointed out.
The material has been provided by InstaForex Company – www.instaforex.com
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