Nothing in yesterday’s flow of economic data to make the Reserve Bank board think about changing the current 2.5% level for the bank’s cash rate.
Housing approvals were OK, but not brilliant, not bad (as some had claimed in early reports), job ads continued to grow last month thanks to the internet.
The last survey of Chinese manufacturing for last month from HSBC/Markit showed a slight weakening, but nothing too dramatic, Australian inflation was OK last month and house prices rose, thanks to rises in Sydney and Melbourne, but fell in other capitals.
As a result of all of this the local market dipped 20 points (Westpac’s 8% rise in full year profit didn’t impress, nor did a sales report from Woolworths). The Aussie dollar remains over 87.30 US cents.
The seasonally adjusted level of building approvals fell sharply because of another big fall in approvals for non private dwellings (home units etc), but in trend terms (which take out the seasonality of the figures) there was no change on August’s figures.
Trend figures for new private house approvals showed a a dip of 0.2%, after a seasonally adjusted drop of 2.3%.
The reason for the big fall was a near 225 drop in seasonally adjusted approvals for townhouses, home units etc. That’s a very volatile part of the approvals series and subject to delays by councils, especially in some parts of NSW, Victoria and Queensland.
In trend terms, approvals for private sector houses fell by 1.8% in Victoria, 0.7% in South Australia and 0.3% in Western Australia, but rose in Queensland by 1.7%,by 0.9% in NSW.
A more accurate look at housing will come with next week’s housing finance data for September and the September quarter.
Job advertisements in newspapers and online edged up a further 0.2% last month to be up 7.5% from the same month of 2013 as demand for labour continues to improve.
The small increase in the ANZ job ads series was the fifth consecutive monthly rise in seasonally adjusted terms and suggests that the job market is moving past the low point earlier this year.
"Consistent with other labour market indicators, the steady improvement in job ads suggests the labour market is turning around," the bank said.
The improvement in October was driven by internet job ads, which were up 0.3% p from September. Newspaper advertising, which accounts for less than 5% of the total, dropped 1.2% in another weak month.
Meanwhile the monthly survey of Australian manufacturing showed a small improvement in october.
The Australian Industry Group’s performance of manufacturing index (PMI) rose 2.9 points to 49.4 in October, just under the 50 level that separates contraction from expansion.
"The slide in manufacturing activity we have seen for the past couple of months has eased, with the sector broadly stable in October," said Innes Willox, AIG chief executive.
"However, conditions remain patchy within the manufacturing sector with considerable differences between sub-sectors and with production and new orders lifting, whereas employment fell further during the month."
Finally, the HSBC/Markit final survey of Chinese manufacturing came up with a reading of 50.4, unchanged from last month’s flash report and still just in expansion territory. That was after the official PMI from the Chinese government was also just above 50.
It was up from the 50.2 final reading for September.
