the australian economy and financial markets - december 2016

The Australian Economy andFinancial MarketsChart Pack February 2018

Contents

GraphsWorld Economy 1–3Australian Growth 4Australian Inflation 5Household Sector 6–7Business Sector 8–9Credit and Money 10Factors of Production and Labour Market 11–12Regions and Industry 13Government 14Commodity Prices 15Balance of Payments and External Position 16–17Interest Rates 18–22Share Markets 23–24Bond Issuance 25–26Exchange Rates 27–28Banking Indicators 29–30

The Australian Economy and Financial Markets

1CHART PACK | FEBRUARY 2018

201320092005 2017-4

-2

0

2

4

6

%

-4

-2

0

2

4

6

%

GDP Growth – WorldYear-ended

Major trading partners*

World**

* Weighted using Australian export shares** PPP-weighted; accounts for 85 per cent of world GDPSources: ABS; CEIC Data; IMF; RBA; Thomson Reuters

201320092005 2017-10

-5

0

5

%

-10

-5

0

5

%

GDP Growth – Advanced EconomiesYear-ended

US Japan

Euro area

Source: Thomson Reuters

201320092005 2017-6

-3

0

3

6

9

%

-6

-3

0

3

6

9

%

GDP Growth – East AsiaYear-ended

Middle-income*

High-income**

* Indonesia, Malaysia, Philippines and Thailand; PPP-weighted** Hong Kong, Singapore, South Korea and Taiwan; PPP-weightedSources: CEIC Data; IMF; RBA

World Economy

ConsumptionInvestmentNet exports

2012200820042000 2016-5

0

5

10

ppt

-5

0

5

10

pptChina – Contributions to GDP Growth

GDP growth(per cent)

Sources: CEIC Data; RBA


World Economy

2014201120082005 2017-4

-2

0

2

4

%

-4

-2

0

2

4

%

Headline Inflation – Advanced Economies*Year-ended

Japan

Euro area

US

* Personal consumption expenditure (PCE) inflation for the US; Japandata excludes the effects of the consumption tax increase in April 2014

Sources: RBA; Thomson Reuters

Labour Markets – Advanced EconomiesUnemployment rate

4

8

12

%

4

8

12

%

Euro area

US

Wage growth*Year-ended

20152013201120092007 2017-2

0

2

4

%

-2

0

2

4

%

Japan

* Average hourly earnings for the US; compensation per employee forthe euro area; smoothed full-time base wages for Japan

Sources: ECB; Eurostat; RBA; Thomson Reuters

201320092005 2017-4

0

4

8

%

-4

0

4

8

%

Inflation – East AsiaYear-ended

High-income**

Middle-income*

* Indonesia, Malaysia, Philippines and Thailand; PPP-weighted** Hong Kong, Singapore, South Korea and Taiwan; PPP-weightedSources: CEIC Data; IMF; RBA; Thomson Reuters

201320092005 2017-5

0

5

10

15

%

-5

0

5

10

15

%

Inflation – China and IndiaYear-ended

China

India

Source: Bloomberg


China – Activity IndicatorsYear-ended growth

Manufacturing PMI*

45

55

index Industrial production

10

20

%

Fixed asset investment

20132009 20170

15

30

% Real retail sales

20132009 20170

10

20

%

* Diffusion index; average of the official and CaixinSources: CEIC Data; Markit Economics; RBA

China – Residential Property Market*Year-ended growth

Floor space sold

0

50

%

0

50

%

Prices

0

10

%

0

10

%

Real estate development investment**

2015201320112009 2017-30

0

30

%

-30

0

30

%

* For sales and investment, a three-month moving average of theseasonally adjusted series is used to calculate growth** Investment by developers and other construction companies in thedevelopment of residential property; includes land purchases


China – Financing*Share of GDP

Total social financing flows**

20122007 20170

15

30

% Fiscal balance

20122007 2017-15

0

15

%

Expenditure

Revenue

Balance

* Seasonally adjusted by RBA** Upper bound estimate adjusting for impact of local government bondissuance to pay off debt previously included in TSF


China – Output Indicators2007 average = 100

20132009 201760

100

140

180

index

Crude steel

Electricitygeneration

20132009 201760

100

140

180

index

Cement

Plate glass


World Economy


Australian Growth

2012200720021997 2017-2

0

2

4

%

-2

0

2

4

%GDP Growth

Year-ended

Quarterly

Source: ABS

Mining and Non-mining ActivityYear-ended growth, RBA estimates

Mining*Mining*

0

10

20

%

0

10

20

%

Mining investment

Resource exports

Non-mining

201320092005 20170

3

6

%

0

3

6

%

* Net of mining-related imports; components are contributions toyear-ended mining activity growth; contribution from changes ininventories not shown

Sources: ABS; RBA

2013200920052001 2017-15

-10

-5

0

5

10

15

%

-15

-10

-5

0

5

10

15

%

State Final DemandYear-ended growth

Rest of Australia

WA

NSW and Vic

Sources: ABS; RBA

September 2017

GD

P

Con

sum

ptio

n

Dw

ellin

gin

vest

men

t

Min

ing

inve

stm

ent

Non

-min

ing

inve

stm

ent

Pub

licde

man

d

Exp

orts

Impo

rts

-2

-1

0

1

2

ppt

-2

-1

0

1

2

ppt

Contributions to GDP GrowthYear-ended

Sources: ABS; RBA


Australian Inflation

Tradable and Non-tradable Inflation*Tradables**Tradables**

0

2

4

%

0

2

4

%

Year-ended

Quarterly(seasonally adjusted)

Non-tradables***Non-tradables***

2012200720021997 2017-2

0

2

4

%

-2

0

2

4

%

* Adjusted for the tax changes of 1999–2000** Excludes volatile items (fruit, vegetables & automotive fuel)*** Excludes interest charges prior to the September quarter 1998, anddeposit & loan facilities prior to the September quarter 2011

Sources: ABS; RBA

2012200720021997 2017-1

0

1

2

3

4

5

%

-1

0

1

2

3

4

5

%Consumer Price Inflation*

Year-ended

Quarterly(seasonally adjusted)

* Excluding interest charges prior to the September quarter 1998 andadjusted for the tax changes of 1999–2000

Sources: ABS; RBA

2012200720021997 20170

1

2

3

4

5

%

0

1

2

3

4

5

%Underlying Inflation*

Weighted median

Trimmed mean

CPI excl volatile items

* Excluding interest charges prior to the September quarter 1998 andadjusted for the tax changes of 1999–2000

Sources: ABS; RBA


Household Sector

20122007200219971992 20176

12

18

24

$b

6

12

18

24

$b

Private Dwelling Investment*Chain volume, quarterly

* Reference year is 2015/16Source: ABS

20122007200219971992 20170

4

8

12

16

20

’000

0

4

8

12

16

20

’000

Private Residential Building ApprovalsMonthly

Higher-density housing

Total

Detachedhouses

Source: ABS

Household Income and Consumption*Real, year-ended growth

0

5

10

%

0

5

10

%

Disposable income

Consumption

Saving ratio

20122007200219971992 2017-5

0

5

10

%

-5

0

5

10

%

* Household sector includes unincorporated enterprises; disposableincome is after tax and interest payments; income level smoothedwith a two-quarter moving average between March quarter 2000 andMarch quarter 2002; saving ratio is net of depreciation

Sources: ABS; RBA

2015201320112009 201770

85

100

index

70

85

100

index

Consumer Sentiment*Average since 1980 = 100

* Average of the ANZ-Roy Morgan and Westpac-Melbourne Instituteconsumer sentiment measure of respondents’ perceptions of theirpersonal finances relative to the previous year; ANZ-Roy Morganindex rescaled to have the same average as the Westpac-MelbourneInstitute index since 1996

Sources: ANZ-Roy Morgan; RBA; Westpac and Melbourne Institute


Household Sector

20162014201220102008 2018-10

-5

0

5

10

15

%

-10

-5

0

5

10

15

%

Housing PricesYear-ended growth, seasonally adjusted

CoreLogic**

ABS*

Residex*

APM***

* ABS is a quarterly stratified median price index; Residex is a quarterlyrepeat sales price index** Monthly hedonic price index; non-seasonally adjusted*** Monthly stratified median price index

Sources: ABS; APM; CoreLogic; RBA; Residex

Housing Prices and Household Debt*Ratio to annual household disposable income

Housing prices

20041991 20172

3

4

5

ratio Household debt

20041991 20170.5

1.0

1.5

2.0

ratio

* Household disposable income is after tax, before the deduction ofinterest payments, and includes income of unincorporated enterprises

Sources: ABS; APM; APRA; CoreLogic; RBA

20132009200520011997 20170

200

400

600

%

0

200

400

600

%

Household Wealth and Liabilities*Per cent of annual household disposable income

Dwellings

Liabilities

Financial assets

Net wealth

* Household disposable income is after tax, before the deduction ofinterest payments, and includes income of unincorporated enterprises

Sources: ABS; RBA

201320092005 20170

5

10

15

20

25

$b

0

5

10

15

20

25

$bHousing Loan Approvals

Total

Owner-occupiers*

Investors**

* Excludes refinancing** Includes refinancingSources: ABS; RBA


Business Sector

20122007200219971992 20170

2

4

6

8

%

0

2

4

6

8

%

Business Investment Components*Share of nominal GDP

Engineering

Buildings

Machinery and equipment

* Adjusted for second-hand asset transfers between the private andother sectors

Source: ABS

11 / 1206 / 0701 / 0296 / 9791 / 92 16 / 170

10

20

30

40

50

%

0

10

20

30

40

50

%Industry Share of Business Investment*

Mining

Construction

Retail andwholesale trade

Financial andinsurance services

Manufacturing

Other businessservices**

Agriculture

* Nominal; includes second hand asset transfers** Includes: information media and telecommunications; rental, hiringand real estate services; professional, scientific and technical services;administrative and support services

Source: ABS

20122007200219971992 201710

12

14

16

18

%

10

12

14

16

18

%

Business Investment*Share of nominal GDP

* Adjusted for second-hand asset transfers between the private andother sectors

Source: ABS

Capital Expenditure – Mining and Non-mining*Nominal, log scale

Mining

07 / 0897 / 98 17 / 182

4

8

16

32

64

128

$b Non-mining

04 / 0591 / 92 17 / 182

4

8

16

32

64

128

$b

* Dots are firms' expectations for 2017/18, adjusted for historicaldifferences between expected and realised spending

Sources: ABS; RBA


Business Sector

NAB Business SurveyBusiness conditions*

-30

-15

0

15

ppt

-30

-15

0

15

ppt

Business confidence*

-30

-15

0

15

ppt

-30

-15

0

15

ppt

Capacity utilisation

20122007200219971992 201772

75

78

81

84

%

72

75

78

81

84

%

Average since 1989

* Net balance; deviation from average since 1989Sources: NAB; RBA

2013200920052001 20170

4

8

12

%

0

4

8

12

%

Private Non-financial Corporation Profits*Share of nominal GDP

Mining

Non-mining

* Gross operating profits; inventory valuation adjustedSources: ABS; RBA

Business FinancesBusiness credit

Per cent of nominal GDP

20092001 201730

40

50

60

70

% Interest paid*Per cent of profits**

20092001 20175

8

11

14

17

%

* Interest on intermediated debt from Australian-domiciled financialinstitutions** Profits are private non-financial gross operating surplus (adjustedfor privatisations) and gross mixed income

Sources: ABS; APRA; RBA


Credit and Money

20132009200520011997 20170

5

10

15

20

%

0

5

10

15

20

%

Monetary Aggregates GrowthYear-ended

M3

Currency

Sources: APRA; RBA

2013200920052001 2017-10

0

10

20

%

-10

0

10

20

%

Credit Growth by SectorYear-ended

Housing

Business

Personal


20132009200520011997 20170

5

10

15

20

%

0

5

10

15

20

%

Credit and Broad Money GrowthYear-ended

Broad money

Credit


20122007200219971992 20170.5

0.8

1.1

1.4

ratio

0.5

0.8

1.1

1.4

ratio

Credit*Ratio to nominal GDP

* Not adjusted for breaksSources: ABS; APRA; RBA


Factors of Production and Labour Market

09 / 1002 / 0395 / 9688 / 8981 / 82 16 / 1780

100

120

140

160

180

200

220

index

80

100

120

140

160

180

200

220

index

Capital Ratios*1979/80 = 100

Capital-output ratio

Capital-labour ratio

* Capital stock excludes livestock & orchards, dwellings and ownershiptransfer costs

Sources: ABS; RBA

Unit Labour Costs GrowthNon-farm, year-ended

Unit labour costs

0

5

%

0

5

%

20132009200520011997 2017-5

0

5

%

-5

0

5

%

Labour productivity per hour

Average earningsper hour

Sources: ABS; RBA

Factors of ProductionAnnual growth

Net capital stock*

3

5

%

3

5

%

Working-age population

09 / 1002 / 0395 / 9688 / 8981 / 82 16 / 171.0

1.5

2.0

%

1.0

1.5

2.0

%

* Excluding livestock & orchards, dwellings and ownership transfer costsSources: ABS; RBA

2013200920052001 20170

1

2

3

4

%

0

1

2

3

4

%Wage Price Index Growth*

Year-ended

Quarterly

* Total pay excluding bonusesSource: ABS


Factors of Production and Labour Market

2014201120082005 20172

4

6

8

%

2

4

6

8

%Labour Market

Underemployment rate*

Unemployment rate

* Full-time workers on reduced hours for economic reasons andpart-time workers who would like, and are available, to work more hours

Source: ABS

2013200920052001 20170.5

1.0

1.5

2.0

%

0.5

1.0

1.5

2.0

%

Job Vacancies and AdvertisementsPer cent of labour force

Vacancies*(ABS survey)

Advertisements(ANZ survey)

* This survey was suspended between May 2008 and November 2009Sources: ABS; ANZ

20132009200520011997 201755

58

61

64

%

55

58

61

64

%Employment and Participation Rates

Participation rate

Employment to working-age population

Source: ABS 20152013201120092007 201790

95

100

105

110

115

index

90

95

100

105

110

115

index

Employment and Hours Worked*2008 average = 100

Total hours worked

Average hours worked

Employment

* Smoothed lines are 13-period Henderson trendsSources: ABS; RBA


Regions and Industry

11 / 1206 / 0701 / 0296 / 9791 / 92 16 / 172

6

10

14

%

2

6

10

14

%Industry Share of Output*

Mining

Manufacturing

Construction

Agriculture

Other business services**

Retail and wholesale trade

Financial and insuranceservices

* Nominal gross value added** Includes: information media and telecommunications; rental, hiringand real estate services; professional, scientific and technical services;administrative and support services

Source: ABS

Employment Growth by IndustryCumulative change since February 2012

2014 2017-200

0

200

400

600

’000

MiningConstruction

Retail andwholesale trade

Householdservices

2014 2017-200

0

200

400

600

’000

Manufacturing

Businessservices

Publicadministration

Other*

* Includes agriculture, forestry & fishing; transport, postal & warehousing;and electricity, gas, water & waste services

Source: ABS

11 / 1206 / 0701 / 0296 / 9791 / 92 16 / 170

5

10

15

20

25

30

35

%

0

5

10

15

20

25

30

35

%

State Share of OutputNominal

South Australia

Tasmania

Western Australia

Queensland

Victoria

New South Wales

Source: ABS

State Unemployment RatesTrend

20122007 20172

3

4

5

6

7

8

%

Queensland

New South Wales

Victoria

20122007 20172

3

4

5

6

7

8

%

South Australia

Western Australia

Tasmania

Source: ABS


Government

20122007200219971992 20170

1

2

3

%

0

1

2

3

%

Public Construction Work DonePer cent of nominal GDP

Total

Engineering

Building

Source: ABS

11 / 1206 / 0701 / 0296 / 9791 / 92 16 / 17-10

0

10

20

30

%

-10

0

10

20

30

%

Non-financial Public Sector Net DebtPer cent of nominal GDP

Australian Government

Non-financial public sector

State and local general governments

Source: Australian Treasury

13 / 1406 / 0799 / 0092 / 9385 / 86 20 / 21-5

-4

-3

-2

-1

0

1

2

%

-5

-4

-3

-2

-1

0

1

2

%

Australian Government Budget Balance*Per cent of nominal GDP

* Underlying cash balance; 2017/18 Mid-year economic and fiscal outlookSource: Australian Treasury

09 / 1003 / 0497 / 9891 / 9285 / 86 15 / 16-1.5

-1.0

-0.5

0.0

0.5

1.0

%

-1.5

-1.0

-0.5

0.0

0.5

1.0

%

State Budget Balances*Per cent of nominal GDP

* Underlying cash balanceSource: ABS


Commodity Prices

201220072002199719921987 201740

70

100

130

160

190

index

40

70

100

130

160

190

index

RBA Index of Commodity PricesSDR, 2015/16 average = 100, log scale

Source: RBA

BulkCommodity PricesFree on board basis

Iron ore(LHS)

2013 201730

75

120

165

US$/t Thermal coal(LHS)

2013 2017

Average Australianexport price

Coking coal(RHS)

2013 201750

150

250

350

US$/t

Spot price*

* Iron ore fines; Newcastle thermal coal and premium hard coking coalSources: ABS; Bloomberg; IHS; RBA

2002198719721957 201740

60

80

100

120

140index

40

60

80

100

120

140index

Terms of Trade*2015/16 average = 100, log scale

* Annual data are used prior to 1960Sources: ABS; RBA

Base Metals, Rural and Oil PricesWeekly

20132008 201825

50

75

100

125

150

index

Rural*

Base metals*

20132008 20180

25

50

75

100

125

US$/b

Brent oil

* RBA Index of Commodity Prices sub-indices; SDR terms; 2007average = 100

Sources: Bloomberg; RBA


Balance of Payments and External Position

Import VolumesQuarterly, 2015/16 prices, log scale

20092001 20172

4

8

16

32

$b

Consumption

Services

20092001 20172

4

8

16

32

$b

Capital

Intermediate

Source: ABS

2012200820042000 20160

5

10

15

20

25

30

%

0

5

10

15

20

25

30

%

Exports by DestinationAnnual, share of total values

Japan

China

USIndia

South Korea

EU - 27

Source: ABS

Export VolumesQuarterly, 2015/16 prices, log scale

20081999 201710

20

40

$b

Resources

20081999 20173

6

12

$b

Services

Rural

Manufacturing

Sources: ABS; RBA

Bulk Commodity ExportsQuarterly

Iron ore

20122007 201725

75

125

175

Mt Coal

20122007 201740

60

80

100

Mt

Sources: ABS; RBA


Balance of Payments and External Position

2013200920052001 2017-4

-2

0

2

4

6

8

%

-4

-2

0

2

4

6

8

%

Net Capital Inflow*Per cent of nominal GDP

Equity

Debt

Total

* 2017 values are year to September quarterSource: ABS

20122007200219971992 2017-9

-6

-3

0

%

-9

-6

-3

0

%

Current Account BalancePer cent of nominal GDP

Current account balance

Trade balanceNet income balance

Source: ABS

2013200920052001 2017-15

0

15

30

45

60

%

-15

0

15

30

45

60

%

Net Foreign LiabilitiesBy type, per cent of nominal GDP

Total

Equity

Short-term debt*

Long-term debt*

* Short-term includes debt with residual maturity of one year or less;long-term includes all other debt

Source: ABS

External PositionComposition after hedging, quarterly*

Gross foreign liabilities

201220070

500

1 000

1 500

2 000

2 500

3 000

$b Gross foreign assets

Foreign currency

Australian dollar

20122007 20170

500

1 000

1 500

2 000

2 500

3 000

$b

* Hedge ratios inferred from ABS Foreign Currency Exposure surveysSources: ABS; RBA


2015201220092006 2018-2

0

2

4

6

8

%

-2

0

2

4

6

8

%

Policy Interest Rates – SelectedAdvanced Economies

UK

CanadaSweden

NZ

Switzerland*

* Policy rate is the midpoint of the 3-month LIBOR target bandSource: Central banks

2012200720021997 2017-2

0

2

4

6

8

%

-2

0

2

4

6

8

%Australian Cash Rate and 90-day Bill Yield

Cash rate90-day bill yield

Real cash rate*

* Calculated using average of year-ended weighted median inflationand year-ended trimmed mean inflation

Sources: ABS; ASX; RBA

2015201220092006 2018-1

0

1

2

3

4

5

%

-1

0

1

2

3

4

5

%Policy Interest Rates

US

Japan

Euro area*

* Main refinancing rate until the introduction of 3-year LTROs inDecember 2011; deposit facility rate thereafter

Source: Central banks

2014201020062002 20181

2

3

4

5

6

7

%

1

2

3

4

5

6

7

%Australian Cash Rate

Source: RBA

Interest Rates


2014201020062002 2018-1

0

1

2

3

4

5

6

%

-1

0

1

2

3

4

5

6

%10-year Government Bond Yields

Japan

Germany

US


Policy Interest Rates – Emerging Markets

20132008 20180

3

6

9

12

%

India

Malaysia

Thailand South Korea

Indonesia*

20132008 20180

4

8

12

16

%

Mexico

SouthAfrica

Russia*Brazil

* Breaks in series indicate changes in the official policy rates for Russia(September 2013) and Indonesia (August 2016)

Source: Central banks

201420102006 20180

2

4

6

%

0

2

4

6

%Interest Rates – China

1-yearbenchmark lending

(month average)7-day repo 1-year

benchmark deposit


2014201020062002 20181

2

3

4

5

6

7

%

1

2

3

4

5

6

7

%10-year Australian Government Bond Yield

Source: RBA

Interest Rates


2013200920052001 20170

2

4

6

8

%

0

2

4

6

8

%Australian Corporate Bond Yields*

A rated

AA rated

BBB rated

Swap

* Swap rates are for 3-year maturity; corporate bond yields are aweighted average of senior bonds with remaining maturities of 1 to 5years, including financial and non-financial corporations

Sources: Bloomberg; RBA; UBS AG, Australia Branch

2013200920052001 20170

100

200

300

400

500

bps

0

100

200

300

400

500

bps

Australian Corporate Bond Spreads*Spread over government yields

BBB rated

AA rated

A rated

Swap

* Swap spreads are for 3-year maturity; corporate bond spreads are aweighted average of senior bonds with remaining maturities of 1 to 5years, including financial and non-financial corporations

Sources: Bloomberg; RBA; UBS AG, Australia Branch

20132008200319981993 2018-100

0

100

200

300

400

500

bps

-100

0

100

200

300

400

500

bps

Differential between Australian andUS 10-year Government Bond Yields


20132008200319981993 2018-6

-4

-2

0

2

4

ppt

-6

-4

-2

0

2

4

ppt

Spread between Australian 10-year BondYield and the Cash Rate

Source: RBA

Interest Rates


2013200820031998 20180

5

10

15

20

%

0

5

10

15

20

%

Emerging Market Bond YieldsUS dollar-denominated, blended yield

Europe

Latin America

Asia

Sources: Bloomberg; RBA; Thomson Reuters

2013200820031998 20180

300

600

900

1 200

1 500

bps

0

300

600

900

1 200

1 500

bps

Emerging Market Bond SpreadsTo US government bonds, duration-matched

Europe

Latin America

Asia

Sources: Bloomberg; RBA; Thomson Reuters

201620142012 2018-100

0

100

200

300

bps

-100

0

100

200

300

bps

US Corporate Bond SpreadsTo US government bonds

BBB corporates*

5-year swap

AA corporates*

* Includes financials and non-financialsSources: Bloomberg; ICE BAML

201620142012 20180

1

2

3

4

%

0

1

2

3

4

%US Corporate Bond Yields

AA corporates*

BBB corporates*

5-year swap

* Includes financials and non-financialsSources: Bloomberg; ICE BAML

Interest Rates


2012200720021997 20170

2

4

6

8

10

%

0

2

4

6

8

10

%

Australian Housing Lending RatesAverage interest rate on variable-rate loans

Banks’ indicator rate on new owner-occupier loans

Actual rate onoutstanding loans

Cash rate

Sources: ABS; APRA; Perpetual; RBA

2012200720021997 20170

2

4

6

8

10

12

%

0

2

4

6

8

10

12

%

Australian Fixed Interest Rates3-year maturity

Small business

Swap rate

Housing*

* Available to owner-occupiersSources: Banks’ websites; Bloomberg; Canstar Cannex; RBA

2012200720021997 20176

7

8

9

10

11

%

6

7

8

9

10

11

%Advertised Small Business Interest Rates*

Overdraft other security

Term loan residential security

* Indicator ratesSources: APRA; Canstar Cannex; RBA

Australian Business Lending Rates*Average interest rate on outstanding lending

Small business

6

8

10

%

6

8

10

%

Large business

20132009200520011997 20172

4

6

8

%

2

4

6

8

%

* RBA estimatesSources: APRA; RBA

Interest Rates


2013200820031998 201840

100

200

300

400500600index

40

100

200

300

400500600index

Advanced Economies’ Share Price IndicesLog scale, end December 1994 = 100

Japan

Euro area US

UK


2013200820031998 201880

100

200

300

400

500

600index

80

100

200

300

400

500

600index

Australian and World Share Price IndicesLog scale, end December 1994 = 100

S&P 500

MSCI WorldASX 200

Sources: Bloomberg; MSCI; RBA

2013200820031998 201860

100

200

300

400

500600

index

60

100

200

300

400

500600index

Australian Share Price Indices*Log scale, end December 1994 = 100

Resources

Financials

All other sectors

* ASX 200 companiesSources: Bloomberg; RBA

2013200820031998 201840

100

200

500

1 000

1 500index

40

100

200

500

1 000

1 500index

Emerging Markets’ Share Price IndicesLog scale, end December 1994 = 100

Emerging Europe

Latin America

Emerging Asia

China

World

Sources: Bloomberg; MSCI; RBA

Share Markets


20132009200520011997 20170

2

4

6

%

0

2

4

6

%Dividend Yields

ASX 200

MSCI Worldexcluding Australia

Sources: Bloomberg; MSCI; Thomson Reuters

2014201120082005 2017250

300

350

400

450

index

250

300

350

400

450

index

Forecast Earnings per ShareMSCI Australia

2005/2006

2006/2007

2007/2008

2008/20092009/2010

2010/2011

2011/2012

2013/2014

2014/2015

2015/2016

2016/2017

2012/2013

2017/2018


2014201020062002 20180

10

20

ratio

0

10

20

ratioForward PE Ratios

MSCI Worldexcluding Australia

ASX 200

Sources: Bloomberg; MSCI; Thomson Reuters

Share Markets

Non-financial corporationsFinancials**

2014201020062002 2018-5

0

5

10

15

20

25

30

$b

-5

0

5

10

15

20

25

30

$bAustralian Net Equity Raisings*

* All listed companies** Includes banks and non-bank financialsSources: ASX; RBA


20122007200219971992 20170

50

100

150

$b

0

50

100

150

$bNon-government Bonds on Issue in Australia

Asset-backed securities*

Non-financialcorporations

Non-residents

Financials

* Excludes ADIs’ self-securitisationsSources: ABS; RBA

Non-government Bond IssuanceGross issuance

AustraliaDomestic issuers*Non-resident issuers**

20

40

$b

20

40

$b

Offshore

2013200920052001 20170

20

40

60

$b

0

20

40

60

$b

* Excludes ADIs’ self-securitisations** Offshore non-resident issuance includes Australian dollar-denominatedbonds only

Source: RBA

20122007200219971992 20170

150

300

450

$b

0

150

300

450

$b

Total Non-government Bonds on IssueAll currency denominations

Financials

Non-financialcorporations

Non-residents*Asset-backed

securities

* Australian dollar-denominated bonds onlySources: ABS; RBA

20122007200219971992 20170

100

200

300

400

500

$b

0

100

200

300

400

500

$bBonds on Issue in Australia

Non-government**

Australian government*

Stategovernments

* Excludes bonds purchased by the Australian Government** Excludes ADIs’ self-securitisations, includes government-guaranteedbonds

Sources: ABS; AOFM; RBA; State Treasury Corporations

Bond Issuance


Bond Issuance

US and Euro Area Corporate Bond Issuance*Gross issuance

USFinancialsNon-financials

100

200

300

400US$b

100

200

300

400US$b

Euro area

2015201220092006 20180

200

400

600

800US$b

0

200

400

600

800US$b

* March quarter-to-dateSources: Dealogic; RBA

Emerging Market Corporate Bond Issuance*Gross issuance

China

Foreign currency-denominatedLocal currency-denominated

100

200

US$b

100

200

US$b

Other

2015201220092006 20180

50

100

150

US$b

0

50

100

150

US$b

* March quarter-to-dateSources: Dealogic; RBA


Official Reserve Assets*

20

40

60

80

A$b

20

40

60

80

A$b

Official reserve assets

Net foreign reserves**

20132009200520011997 2017-4-2024

A$b

-4-2024A$bRBA foreign exchange market intervention transactions***

* The reporting methodology for official reserve asset data changesin 2015** Excludes net forward foreign currency commitments*** Data up to 30 June 2017; a positive value indicates a purchase offoreign exchange, while a negative value indicates a sale of foreignexchange

Source: RBA

20122006200019941988 201850

100

150

200

yen

0.40

0.80

1.20

1.60

US$,euro

Australian Dollar

Yen per A$(LHS)

(RHS)

US$ per A$(RHS)

Euro per A$*

* ECU per A$ until 31 December 1998Source: Bloomberg

20122006200019941988 201840

50

60

70

80

index

40

50

60

70

80

indexAustralian Dollar Trade-weighted Index*

Nominal

Real

* May 1970 = 100 for nominal; real indexed to equate post-floataverages; latest observations for real TWI are estimates

Sources: ABS; RBA; Thomson Reuters; WM/Reuters

Exchange Rates


2014201020062002 201840

60

80

100

120

140

index

40

60

80

100

120

140

index

Selected Asian Currencies against the US Dollar31 January 2000 = 100

India

Thailand

South Korea

Malaysia

Singapore

Indonesia

Source: Bloomberg

20112004199719901983 201850

90

130

170

210

250

yen

2.90

2.50

2.10

1.70

1.30

0.90

US$US Dollar

(LHS)Yen per US$

US$ per euro*(RHS, inverted scale)

* US$ per ECU until 31 December 1998Sources: Bloomberg; Eurostat

2014201020062002 201860

70

80

90

100

110

120

index

9.0

8.5

8.0

7.5

7.0

6.5

6.0

yuanChinese Renminbi

(LHS, 2010 average = 100)

Yuan per US$(RHS, inverted scale)

Nominal effective exchange rate

Sources: BIS; Bloomberg; RBA2014201020062002 201880

90

100

110

120

index

80

90

100

110

120

index

G3 Nominal Trade-weighted Indices1999–2018 average = 100

US dollar

Euro

Japanese yen

Sources: BIS; Bloomberg; Board of Governors of the Federal ReserveSystem

Exchange Rates


Australian Bank ProfitsNet profit after tax Bad and doubtful debts charge

Major banks

6

12

$b Major banks

6

12

$b

Other Australian-ownedbanks

1.1

2.2

$b Other Australian-ownedbanks

1.1

2.2

$b

Foreign-owned banks

20122007 2017-1.5

0.0

1.5

$b Foreign-owned banks

20122007 2017-1.5

0.0

1.5

$b

Sources: APRA; RBA

201220072002199719921987 2017-10

0

10

20

%

-10

0

10

20

%

Australian Bank Profitability*Return on shareholders’ equity after tax and minority interests

Majors

Other Australian-owned banks

* Fiscal years from 2003 onwards; prior data are as reported in banksfinancial statements

Sources: APRA; Banks’ annual reports; RBA

2013200920052001 20171.5

2.0

2.5

3.0

%

1.5

2.0

2.5

3.0

%

Major Banks’ Net Interest Margin*Domestic, half-yearly

* From 2006 data are on an IFRS basis; prior years are on AGAAPbasis; excludes St George Bank and Bankwest prior to the first halfof 2009

Sources: Banks’ Financial Reports; RBA

Banking Indicators


Banks’ Non-performing AssetsDomestic books

Share of all loans

20122007 20170

1

2

3

4

%

Total

Share of loans by type*

20122007 20170

1

2

3

4

%

Housing

Personal

Business**

(4%)

(35%)

(61%)

* Each category’s share of total domestic lending at September 2017is shown in parentheses; shares may not add up to 100 due to rounding** Includes lending to financial businesses, bills, debt securities andother non-household loans

Sources: APRA; RBA

20122007200219971992 20170

2

4

6

%

0

2

4

6

%

Banks’ Non-performing AssetsConsolidated global operations, share of on-balance sheet assets

Total*

Impaired

* Includes assets 90+ days past due that are well securedSource: APRA

2014201120082005 20170

10

20

30

40

50

60

%

0

10

20

30

40

50

60

%

Funding Composition of Banks in Australia*Share of total funding

Domestic deposits

Short-term debt**

EquitySecuritisation

Long-term debt

* Adjusted for movements in foreign exchange rates; tenor of debt isestimated on a residual maturity basis** Includes deposits and intragroup funding from non-residents

Sources: APRA; RBA; Standard & Poor’s

Capital Ratios*Consolidated global operations of locally incorporated ADIs

Banks

20051993 20170

5

10

15

%

Total

Tier 1

Common Equity Tier 1

Tier 2

Other ADIs

20051993 20170

5

10

15

%

Building societies

Credit unions

* Per cent of risk-weighted assets; break in March 2008 due to theintroduction of Basel II for most ADIs; break in March 2013 due to theintroduction of Basel III for all ADIs

Source: APRA

Banking Indicators

the australian economy and financial markets - december 2016

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