Each quarter CommSec attempts to find out how the states and territories are performing by analysing eight key indicators: economic growth; retail spending; equipment investment; unemployment, construction work done; population growth; housing finance and dwelling commencements.
Just as the Reserve Bank uses decade averages to determine the level of “normal” interest rates; we have done the same with the economic indicators. For each state and territory, latest readings for the key indicators were compared with decade averages – that is, against the “normal” performance.
- In the last two quarterly reports, we judged that Australia’s multi-speed economy could more accurately be described as a three-speed economy.
- But in the latest report the best way to describe the situation is Western Australia first and daylight second.
- Western Australia comes out top on five of the eight criteria. The worst results were being ranked fourth on two of the eight indicators. So when discussing the Australian economy it is best to focus on two concepts: total Australia, and Australia excluding Western Australia.
- ACT and Victoria are in the next grouping of economies, and then there is a break to Queensland, NSW and South Australia and then another gap to the Northern Territory and Tasmania.
- Looking ahead, CommSec expects further improvement in both Queensland and NSW with the latter potentially benefitting from a stronger job market and a pick-up in housing activity.
To read the full report, click here.