With most of us just shaking the sand off our toes and coming back to work, some of the positive news may have been missed.
A few significant items hitting the news that are reinforcing for our Australian economy are worthy of noting below;
New home sales rise in November 2012
Source : Housing Industry Association – 9 Jan 2013
New home sales have risen for a second straight month as buyers headed into the property market on the back of lower interest rates and state government assistance.
A Housing Industry Association (HIA) report just released notes new home sales were up 4.7 per cent in November, on the back of a 3.4 per cent increase the previous month.
The November result was led by sales of detached houses, which snapped five consecutive months of declines to rise 7.7 per cent in the month.
Unemployment rates continue to fall in US cities
Source AAP – 8 Jan 2013
Unemployment fell below seven per cent in most United States cities in November 2012, suggesting steady job gains are benefitting most parts of the country.
The government said that the unemployment rate fell in November from October in 215 of the 372 largest metro areas.
Unemployment dropped below seven per cent in 192 cities. That’s the first time since the recession ended that more than half of large cities had an unemployment rate below that threshold. Reports noted that 52 cities were below five per cent unemployment.
These are very encouraging signs for the US economy and the flow on to our Australian economic outlook.
China regains momentum in 2013
Source AAP – 9 Jan 2013
The ascendancy of the new Chinese leadership team led by Xi Jinping, who will formally succeed Hu Jintao as president in March 2013, is tipped to boost demand for Australia’s key exports – iron ore and coal.
Commodity prices have been steadily recovering erasing much of the three-year lows late last year.
HSBC chief economist Paul Bloxham is forecasting China’s economic growth rate will pick up from 7.8 per cent last year to 8.6 per cent this year.
“An improving global economy – particularly one led by Chinese growth – should be positive for commodity prices, which in turn will support Australian growth,” Mr Bloxham said. “Growth in the mining sector, iron ore and coal especially, should be supported by a pick up in the housing and retail sectors, with the tourism industry also expected to recover.”
The forecast acceleration in Chinese growth has seen iron ore miner Fortescue resume work on its Kings deposit in Pilbara — which it had scrapped only four months ago as commodity prices tumbled.
Morgan Stanley is tipping iron ore prices will stabilise this year at about $US120 a tonne – up from a low of $US86 in September.
Andrew Colquhoun, Fitch Ratings’ head of Asia-Pacific Sovereigns research, expects China’s new leadership to focus on rebalancing the economy, supporting commodity prices and growth for Australia in areas such as tourism and education.