Forecasts of Consumer Spending and Economic Gro...

Forecasts of Consumer Spending and Economic Growth

Forecasts of Consumer Spending and Economic Growth

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Not all Australians prefer lower interest rates.  Some prefer higher rates and some prefer no change.  This report is based on consumer survey tracking data and shows how interest rate preferences vary over time and by demographic.  It shows that interest rates have lost their power to influence aggregate consumer spending growth in this very low interest rate environment.  It also points to another way to boost consumer spending growth.


In his 2004 book “The Wisdom of Crowds”, James Surowiecki makes an interesting case that if you want to make a correct decision then large numbers of ordinary people can provide better advice than a small number of experts.  We have been researching this concept since 2005 and find that it is a potentially useful technique - but that applying it is rather more complex than suggested by Surowiecki.

We prefer the term "the wisdom of the masses" rather than crowds because the latter does not suggest sufficient diversity.

Consumer expectations have been found to be valuable for forecasting and predicting behaviour.

The 2017 survey of expectations for 2018 presents some challenges for Malcolm Turnbull and his government.


House prices are an important economic variable.  They are a major component of household wealth, a significant driver of consumer spending, and a hurdle for prospective first home buyers.  This report is based on a unique leading indicator of Australian house price inflation.


New vehicle sales forecast for 2019 and 2020.


There are mixed messages on the outlook for Australia's economy in late 2017 and 2018.  Explore the issues and signs to watch.


The drivers of consumer spending in Australia are identified and quantified.  The outlook for 2018, along with some scenarios, are included in this report.


Australia's business sentiment is buoyant and employment growth is the best since before the GFC.  Population growth is strong.  The federal government is bullish.  Both private and public economic forecasters are optimistic. What could go wrong?  The paradox is that major drivers of the economy are very weak.  This report reviews the conflicting evidence and discusses the risks and opportunities for Australia in 2018. 


Retail sales growth scenarios for the next 18 months.  Identification and analysis of the key economic drivers, the impact of the imminent federal election, consumer spending sentiment, opportunity and threat.

As 2018 progressed, new vehicle sales slumped. Is this the start of Peak Car or is it a perfect storm? Our report analyses the causes of the slump.