Reserve Bank Eyes Economic Growth Data Amid Inflation Fears

The Reserve Bank of Australia is set to review economic growth data after hotter-than-expected inflation figures. The Australian Bureau of Statistics will release national accounts figures on Wednesday, which are expected to show a slowing GDP growth rate.

Westpac senior economist Pat Bustamante forecasts a 0.2 per cent increase in GDP for the June quarter, down from 0.3 per cent in the March quarter. However, the annual rate is still expected to be 1.7 per cent year-on-year, above the Reserve Bank's assumption.

The economy has been showing signs of resilience despite higher interest rates and fuel prices. Bustamante notes investment in data centres, renewable energy, and home building as supporting factors. Household spending grew at its fastest rate since the series began in 2023 in July, with Westpac activity data indicating continued strength through early August.

The Reserve Bank will also consider other economic indicators, including building approvals data and trade figures. Reserve Bank chief economist Sarah Hunter is set to appear before a Senate hearing on intergenerational housing inequity on Thursday.