Paul Bloxham reveals how Australia’s economy will stack up in 2016
2016 is shaping up to be a big year for Australians and economic pundits alike, as the country strives for growth in the wake of the mining boom, and a high stakes federal election looms.
With these challenges on the horizon, Governance Institute invited HSBC’s eminent chief economist, Paul Bloxham, to share his thoughts on where the economy is headed, in this ‘Fast Five’ Q&A.
Q1. What’s your overall outlook for the Australian economy in 2016?
Paul: We’re fairly optimistic that growth will continue and will be supported by the housing and services sector as Australia rebalances away from the mining boom.
Q2. Have we successfully diversified our reliance on the mining boom?
Paul: Yes, the Australian economy has pulled off a great rebalancing act since the mining boom. Growth led by the housing and services sector is picking up strongly.
Q3. Will the direction of the Australian dollar help us?
Paul: The lower Australian dollar has been a key driver in our ability to rebalance economic growth. A further fall would be helpful to continue that process, but the challenge is that the dollar seems to be stuck around the US 70-72 cent mark.
Q4. Can we expect a further interest rate cut in 2016?
Paul: It’s likely the Reserve Bank of Australia will cut interest rates a bit further this year. That’s because interest rates in the rest of the world are very low at the moment. So if the RBA doesn’t also deliver a cut, there’s a risk the Aussie dollar will rise, which would be a concern.
Q5. Will business and consumer confidence improve?
Paul: Business conditions have started the year at fairly high levels. In New South Wales, it’s sitting at the highest level in two decades — which bodes well for investment, spending and jobs.
Paul Bloxham will address Governance Institute’s Corporate Governance Forum in Sydney on 25 May 2016. Paul’s much-anticipated update will come hot on the heels of the 2016 Federal Budget and the unveiling of the government’s plans for tax reform and budget repair.
Corporate Governance Forum 2016 takes place in:
- Sydney — Wednesday, 25 May 2016
- Perth — Thursday, 26 May 2016
- Melbourne – Wednesday, 1 June 2016
- Adelaide — Thursday, 2 June 2016
- Brisbane — Thursday, 2 and Friday 3 June 2016
Come along for further insights to help your organisation bring its ‘A’ game when navigating a shifting business environment.