- The economic impact of COVID has differed by industry;
- And by state;
- WA looks to have done best in recent months, Victoria (understandably) has struggled;
- Better relative performance is interesting. Better absolute performance is what matters.
State Final Demand data told us that WA and the ACT had the strongest economies in the first half of the year, the ‘big’ states (NSW and Victoria) and Tassie did worst. There was a notable difference in growth performance between states. But not unusually large.
Across a range of indicators, Victoria had the weakest economy in the third quarter and WA the best. The story is more mixed between the other states. On balance, Queensland looks to have been the next best performing state, followed by SA. Most indicators suggest things were a little weaker in NSW. Tasmania was a little more puzzling, with some data suggesting it was leading the pack (hours worked), and others that it was lagging (consumer confidence).
One indicator that is telling a slightly different story is house prices. Partly the movement in house prices reflects relative state economic performance. But there are also supply and demand factors that are specific to the housing market.
To read my full update, click here.
We live in interesting times!
Peter Munckton - Chief Economist