Missed this yesterday but thought it worthy of a mention the emphasis in bold is mine. From Westpac.com.au:

The annualised growth rate of the Westpac–Melbourne Institute Leading Index, which indicates the likely pace of economic activity three to nine months into the future, was 1.1% in September, well below its long term trend of 3.9%. The annualised growth rate of the Coincident Index was 1.6%, also below its long term
trend of 3.6%.

This is a very disturbing fall in the growth rate of the Leading Index. The growth rate fell from 3.5% in August 2008 to 1.1% in September 2008. That represents the largest percentage point fall between two months since the mid 1980's – sharper even than we saw in the 1990/91 recession.

The growth rate is signalling a very weak growth outlook through at least the first half of 2009. It is consistent with Westpac's view that growth in the first half of 2009 will be barely positive with a decent risk that the first two quarters of growth in 2009 could be negative.

So basically Westpac is toying with the idea of the first Australian recession in almost 2 decades. With the US going ino the worst recession since at least 1981-2 how can Australia possibly avoid at least a mild one?