2020.01.2902:53:00UTC+00Australia Leading Index Signals Weak Economic Momentum

Australia's leading index signaled weak economic momentum continuing in the first half of 2020, data published by Westpac showed on Wednesday.

The Westpac- Melbourne Institute leading index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, rose to -0.32 percent in December from -0.62 percent in November.

Nonetheless, the index growth remained below zero, representing the thirteenth straight month where the index growth has been negative.

Data showed that the leading index growth rate deteriorated over the second half of 2019, moving to the current -0.32 percent in December from -0.03 percent in July, largely due to a sell-off in commodity prices and a more mixed performance on the Australian share market.

The Reserve Bank of Australia Board next meets on February 4. Westpac expects that the bank to hold the cash rate steady at its February meeting. However, the decision is likely to be a temporary pause in the rate cut cycle, Bill Evans, chief economist at Westpac said.