Australian economic activity above trend growth, but pulse past its peak

Australia's Westpac Banking Corp and the Melbourne Institute stated 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 6.8% in Jul-2010, well above its long term trend of 3.2%. The annualised growth rate of the Coincident Index was 4.3%, also above its long term trend of 3.3%. However, the companies stated it is the fourth consecutive month when the growth rate of the Index has slowed. In absolute terms the growth rate of the Index is still high but it has clearly peaked. Based on current forecasts, that year average growth in 2010 will be 3.5%, with an even pace through the year, despite some sizeable swings in different sectors.