Each quarter CommSec attempts to find out 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 quarterly report, we judged that Australia’s multi-speed economy could more accurately be described as ‘Western Australia first and daylight second’. And we see no reason to change that judgement with the latest results – Western Australia comes out on top on six of the eight criteria. The worst results were being ranked fifth on dwelling starts and third on housing finance.

So when discussing the Australian economy it is still best to focus on two concepts: total Australia, and Australia excluding Western Australia.ACT, Victoria, Queensland and Northern Territory are in the next grouping of economies, and then there is a break to NSW and South Australia and then another gap to Tasmania.Looking ahead, CommSec expects further improvement in Queensland and Northern Territory but potential slippage in Victoria with a softer job market.

To read the report, click here.

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