A raft of economic data out today confirms what we already suspected and that is that the Australian economy slowed markedly in October. Firstly some numbers for September. Retail Sales rose 0.2% in September and are up 2.3% year over year. That may sound OK but remember that is a nominal number so adjusted for inflation retail sales are down something like -2.5% year over year.
Also out today, the ANZ job series fell sharply in October, internet job ads which comprise almost 95% of the total are now down almost -15% from the peak in April this year. As mentioned in previous posts the job ad series is a decent indicator future employment.
The Performance of Manufacturing index also released today was the worst in 16 years, the index registered a reading of 40.4 well below the 50 level that marks the separation between expansion and contraction. October marks the fifth straight month of a contracting manufacturing sector. The plunge in the employment component to a reading of 37.6 points to more job losses in the Australian manufacturing sector coming down the pike.
Also of note, the abs released quarterly home price numbers for all Australian capital cities. A year ago all capital cities were hitting new highs, as of September 2008, only Darwin continues to make new highs. It should be noted that Darwin is subject to a much larger margin of error.
From it's peak Australian home prices are down -2.1% from their peak on a weighted average basis. Apart from the new peak in Darwin the other capital cities are down from their peaks as follows:
Weighted Average -2.1%
This is just the beginning for home price falls in Australia, despite the government's senseless efforts to prop up prices with their home buyer grants. And yes yes I know, sought after areas such as the eastern suburbs of Sydney won't plummet as much as other areas like the west because people want to live there. I get it, all real estate is local.