STATEMENT ON MONETARY POLICY – AUGUST 2007
List of tables
Table 1: World GDP
Table 2: Commodity Prices
Table 3: Changes in Monetary Policy
Table 4: Changes in Global Share Prices
Table 5: Change in US Dollar against Other Currencies
Table 6: Australian Dollar against Selected TWI Currencies
Table 7: Demand and Output
Table 8: House Prices
Table 9: Fiscal Balance – General Government Sector
Table 10: Volume of Farm Production
Table 11: Unemployment Rates by State
Table 12: Share Market Performance
Table 13: Financial Aggregates
Table 14: Measures of Consumer Prices
Table 15: Median Inflation Expectations
Table 16: RBA Inflation Forecasts
Boxes
Table A1: Share of World Activity
Table C1: Measures of Construction Activity
..................................................................................................................................  |
Table 1: World GDP
Year-average percentage change(a)
|
2005 |
2006 |
2007 |
2008 |
|
|
|
|
|
|
|
IMF forecasts (July 2007) |
|
| United States |
3.1 |
2.9 |
2.0 |
2.8 |
| Euro area |
1.6 |
2.9 |
2.6 |
2.5 |
| Japan |
1.9 |
2.2 |
2.6 |
2.0 |
| China |
10.4 |
11.1 |
11.2 |
10.5 |
| Other east Asia(b) |
4.9 |
5.4 |
4.9 |
5.0 |
| India |
8.7 |
9.7 |
9.0 |
8.4 |
| World |
4.9 |
5.5 |
5.2 |
5.2 |
| Australia’s trading partners(c) |
4.3 |
4.9 |
5.1 |
4.8 |
|
| (a) Aggregates weighted by GDP at PPP exchange rates unless otherwise specified |
| (b) Weighted by GDP at market exchange rates |
| (c) Weighted using merchandise export shares |
| Sources: CEIC; IMF; RBA; Thomson Financial |
.................................................................................................................................. |
Table 2: Commodity Prices
Percentage change; SDR
|
Three months
to July 2007 |
Year to
Jul-07 |
|
| RBA index |
–0.6 |
4.4 |
| Rural |
8.9 |
11.8 |
| – Wheat |
14.5 |
16.5 |
| – Beef & veal |
1.9 |
0.9 |
| – Wool |
3.2 |
38.1 |
| – Sugar |
11.4 |
–29.4 |
| Base metals |
–9.5 |
13.8 |
| – Aluminium |
–3.4 |
5.4 |
| – Copper |
2.8 |
–0.2 |
| – Nickel |
–33.8 |
23.3 |
| – Zinc |
–0.8 |
3.2 |
| – Lead |
53.8 |
181.9 |
| Other resources |
0.5 |
–2.0 |
| – Coking coal(a) |
–1.0 |
–12.8 |
| – Steaming coal(a) |
7.2 |
4.9 |
| – Iron ore(a) |
4.7 |
7.1 |
| – Gold |
–2.7 |
1.5 |
| Memo item |
|
|
| Oil in US$(b) |
|
|
| – WTI |
15.7 |
–0.5 |
| – Tapis |
6.2 |
2.7 |
|
| (a) Latest available data are for June.
|
| (b) Oil prices are not included in the RBA index.
|
| Sources: ABS; AWB; AWEX; Bloomberg; Meat and Livestock Australia; RBA
|
.................................................................................................................................. |
Table 3: Changes in Monetary Policy
|
Current level
Per cent |
Most recent
change |
Expectations for
next 6 months |
|
| United States |
5.25 |
↑ |
Jun-06 |
↓ 25 bps |
| Euro area |
4.00
| ↑ |
Jun-07 |
↑ 25 bps |
| Japan |
0.50
| ↑ |
Feb-07 |
↑ 25 bps |
| United Kingdom |
5.75
| ↑ |
Jul-07 |
↑ 25 bps |
| Canada |
4.50
| ↑ |
Jul-07 |
↑ 25 bps |
| New Zealand |
8.25 |
↑
| Jul-07
| No change |
|
| Sources: central banks; Bloomberg; Reuters |
.................................................................................................................................. |
Table 4: Changes in Global Share Prices
Per cent
|
Since 2000 peak |
Over the past year |
Since previous
Statement |
|
| United States |
|
|
|
| – Dow Jones |
17 |
22 |
3 |
| – S&P 500 |
–2
| 18 |
0 |
| – NASDAQ |
–48
| 27 |
2 |
| Euro area |
|
|
|
| – STOXX |
–10 |
22 |
–2 |
| United Kingdom |
|
|
|
| – FTSE |
–8 |
10 |
–1 |
| Japan |
|
|
|
| – TOPIX |
–5 |
7 |
–2 |
| Canada |
|
|
|
| – TSE 300 |
21 |
15 |
1 |
| Australia |
|
|
|
| – ASX 200 |
75 |
21 |
–2 |
| MSCI Emerging Asia |
52
| 44 |
16 |
| MSCI Latin America |
234
| 43 |
9 |
| MSCI World |
4 |
19 |
0 |
|
| Source: Bloomberg |
.................................................................................................................................. |
Table 5: Change in US Dollar against Other Currencies
Per cent
|
Past
year |
Since previous
Statement |
|
| New Zealand |
–19 |
–4 |
| Brazil |
–13
| –7 |
| India |
–13 |
–2 |
| Philippines |
–12 |
–5 |
| Australia |
–11 |
–3 |
| Thailand |
–10 |
–2 |
| Euro area |
–7 |
–1 |
| Canada |
–7 |
–6 |
| Sweden |
–6 |
0 |
| Malaysia |
–6 |
1 |
| United Kingdom |
–6 |
–2 |
| China |
–5 |
–2 |
| Singapore |
–4 |
–1 |
| South Korea |
–4 |
–1 |
| Switzerland |
–2 |
–1 |
| Taiwan |
0 |
–1 |
| Mexico |
0 |
0 |
| Indonesia |
2 |
2 |
| South Africa |
3 |
0 |
| Japan |
4 |
0 |
| Majors TWI |
–5
| –3 |
| Broad TWI |
–5
| –2 |
|
| Source: RBA |
.................................................................................................................................. |
Table 6: Australian Dollar against Selected TWI Currencies
Percentage change
|
Past year |
Since previous
Statement |
|
| Japan |
18 |
5 |
| South Africa |
17 |
4 |
| Indonesia |
15
| 6 |
| Taiwan |
14
| 3 |
| US |
14
| 5 |
| PNG |
11
| 2 |
| Switzerland |
11
| 3 |
| South Korea |
10
| 4 |
| Singapore |
9 |
4 |
| China |
8
| 3 |
| Canada |
6
| –1 |
| Euro area |
6
| 3 |
| Sweden |
6
| 4 |
| UK |
6
| 2 |
| Philippines |
0
| –1 |
| New Zealand |
–7
| 0 |
| TWI |
10 |
4 |
|
| Source: RBA |
.................................................................................................................................. |
Table 7: Demand and Output
Percentage change
|
December
qtr 2006
|
March
qtr 2007 |
Year to March
qtr 2007 |
|
| Domestic final demand |
1.2 |
1.5 |
4.5 |
| Change in inventories(a) |
0.7 |
0.5 |
0.6 |
| GNE(b) |
2.3 |
1.8 |
5.3 |
| Net exports(a) |
–1.3 |
–0.2 |
–1.6 |
| GDP |
1.1
| 1.6 |
3.8 |
| Non-farm GDP |
1.3
| 1.7 |
4.6 |
| Farm GDP |
–10.4
| –0.2 |
–22.7 |
| Memo item: |
|
|
|
Real GDP adjusted for
changes in the terms of trade |
1.4 |
1.9 |
5.4 |
|
| (a) Contributions to GDP growth |
| (b) Includes the statistical discrepancy |
| Sources: ABS, RBA |
.................................................................................................................................. |
Table 8: House Prices
Percentage change
|
March qtr |
June qtr |
Year to
June qtr |
|
| Sydney |
0.1 |
2.3 |
3.0 |
| Melbourne |
1.7 |
5.0 |
11.5 |
| Brisbane |
4.2 |
6.5 |
15.7 |
| Adelaide |
2.2 |
5.7 |
11.7 |
| Perth |
1.3 |
–0.9 |
15.3 |
| Canberra |
1.3 |
2.9 |
9.0 |
| Hobart |
3.4 |
2.3 |
9.7 |
| Darwin |
2.5 |
–1.4 |
7.4 |
| Australia |
1.4 |
3.2 |
9.2 |
|
| Source: ABS |
.................................................................................................................................. |
Table 9: Fiscal Balance – General Government Sector(a)
Estimates, $ billion
|
2006/07 |
2007/08 |
|
| Federal government |
12.8 |
11.0 |
| – Per cent of GDP |
1.2 |
1.0 |
| State governments |
–2.1 |
–5.7 |
| – Per cent of GDP |
–0.2 |
–0.5 |
| Total – federal and state |
10.7 |
5.3 |
| – Per cent of GDP |
1.0 |
0.5 |
|
| (a) ABS Government Finance Statistics basis |
| Sources: Australian Treasury; RBA; state Treasuries |
.................................................................................................................................. |
Table 10: Volume of Farm Production
Per cent
|
Share of gross production |
Growth(a) |
|
|
|
|
2005/06 |
2006/07 |
2007/08 |
|
| Crops |
44 |
–31 |
40 |
| – Cereals |
17 |
–60 |
130 |
| – Non-cereal crops |
27 |
–13 |
15 |
| Livestock products |
46 |
–3 |
0 |
| Farm GDP(b) |
|
–21 |
20 |
|
| (a) Estimate for 2006/07, forecast for 2007/08 |
| (b) Gross farm production less farm inputs |
| Sources: ABARE; ABS; RBA |
.................................................................................................................................. |
Table 11: Unemployment Rates by State
Per cent
|
Three months ended |
|
|
|
July 2006 |
July 2007 |
|
| NSW |
5.1 |
4.8 |
| Victoria |
5.1 |
4.6 |
| Queensland |
4.5 |
3.5 |
| WA |
3.2 |
3.4 |
| SA |
4.8 |
4.8 |
| Tasmania |
6.4 |
4.8 |
| Australia |
4.8 |
4.3 |
|
| Source: ABS |
.................................................................................................................................. |
Table 12: Share Market Performance
Per cent
|
Dec 2002–Dec 2006
Average annual change |
Financial year
2006/07 |
Calendar year
to date |
|
| ASX 200 |
17.2 |
23.7 |
7.6 |
| S&P 500 |
12.7 |
18.4 |
5.6 |
| MSCI ex US |
16.8 |
20.3 |
4.2 |
|
| Sources: Bloomberg; RBA; Thomson Financial |
.................................................................................................................................. |
Table 13: Financial Aggregates
Average monthly growth, percentage change
|
September
quarter
2006 |
December
quarter
2006 |
March
quarter
2007 |
June
quarter
2007 |
|
| Total credit |
1.2 |
1.0 |
1.2 |
1.4 |
| Household |
1.2 |
0.8 |
1.0 |
1.3 |
| – Housing |
1.2 |
0.8 |
1.0 |
1.2 |
| Owner-occupier housing |
1.4 |
1.0 |
1.0 |
1.2 |
| Investor housing |
0.8 |
0.5 |
0.9 |
1.3 |
| – Personal |
1.2 |
0.7 |
0.9 |
2.0 |
| Business |
1.1 |
1.2 |
1.7 |
1.7 |
| Broad money |
1.1 |
0.8 |
1.2 |
1.3 |
|
| Source: RBA |
.................................................................................................................................. |
Table 14: Measures of Consumer Prices
Percentage change
|
Quarterly |
Year-ended |
|
|
|
|
March
quarter
2007 |
June
quarter
2007 |
March
quarter
2007 |
June
quarter
2007 |
|
| CPI |
0.1 |
1.2 |
2.4 |
2.1 |
| – Tradables |
–1.0 |
2.0 |
1.0 |
0.3 |
| – Tradables (ex food and petrol) |
0.0 |
0.8 |
0.4 |
1.0 |
| – Non-tradables |
0.9 |
0.7 |
3.5 |
3.4 |
| Underlying measures |
|
|
|
|
| Weighted median |
0.6 |
0.9 |
2.8 |
2.8 |
| Trimmed mean |
0.5 |
0.9 |
2.7 |
2.7 |
| CPI ex volatile items(a) |
0.6 |
0.7 |
2.5 |
2.6 |
|
| (a) Volatile items are fruit, vegetables and petrol |
| Sources: ABS; RBA |
.................................................................................................................................. |
Table 15: Median Inflation Expectations
Per cent
|
Year to June 2008 |
Year to June 2009 |
|
|
|
|
February
2007 |
May
2007 |
August
2007 |
August
2007 |
|
| Market economists(a) |
2.5 |
2.5 |
2.7 |
2.7 |
| Union officials(b) |
3.5 |
3.0 |
3.0 |
3.0 |
|
| (a) RBA survey |
| (b) Workplace Research Centre |
.................................................................................................................................. |
Table 16: RBA Inflation Forecasts(a)
Percentage change over year to quarter shown
|
June
2006 |
Dec
2006 |
June
2007 |
Dec
2007 |
June
2008 |
Dec
2008 |
June
2009 |
|
| Consumer price index |
4.0 |
3.3 |
2.1 |
2½ |
3 |
2½–3 |
2½–3 |
| Underlying inflation |
2.9 |
3.0 |
2.8 |
3 |
3 |
2½–3 |
2½–3 |
|
| (a) Actual data to June 2007. Underlying inflation refers to the average of trimmed mean and weighted median inflation. For the forecast period, technical assumptions include A$ at US$0.86, TWI at 69, cash rate at 6.5 per cent, and WTI crude oil price at US$73 per barrel and Tapis crude oil price at US$75 per barrel. |
| Sources: ABS; RBA |
.................................................................................................................................. |
Boxes
Table A1: Share of World Activity
Selected economies, 2006, per cent
|
GDP |
Australia’s exports(a) |
|
|
|
|
PPP exchange rates |
Market exchange rates |
|
|
| United States |
20 |
28 |
6 |
| Euro area |
15 |
23 |
7 |
| Japan |
6 |
9 |
19 |
| China |
15 |
5 |
14 |
| Other east Asia |
7 |
5 |
24 |
| India |
6 |
2 |
6 |
| Australia |
1 |
2 |
na |
|
| (a) Merchandise exports, valued at market exchange rates |
| Sources: ABS; IMF; RBA |
.................................................................................................................................. |
Table C1: Measures of Construction Activity
Chain volumes, percentage change
|
Value added(a) |
Expenditure |
Employment |
|
|
|
|
|
|
Non-residential |
Residential |
|
|
| 2003/04 |
6.6 |
5.6 |
4.6 |
8.0 |
| 2004/05 |
4.8 |
10.2 |
–1.5 |
7.7 |
| 2005/06 |
8.3 |
16.9 |
–4.0 |
4.8 |
| 2006/07(b) |
7.5 |
8.6 |
3.8 |
6.9 |
| Average |
6.8 |
10.3 |
0.6 |
6.8 |
|
| (a) Gross value added at basic prices |
| (b) Estimate |
| Source: ABS |
Footnote
- Construction industry data are on a value-added basis. Data for residential and non-residential construction refer to expenditure as value-added data are not available. (back to text)
|
