One piece of information managed to shake me out of my flu induced daze for long enough to write a post – Australian GDP had a surprising fall over the December quarter, falling 0.5% (seasonally adjusted) on September.
Appears that inventory accumulation was knocked down sharply – that is very interesting. Usually during a recession inventories are a positive contributor – as spending slows more quickly than production. This implies to me that the fall in GDP may not be sustainable – as inventory accumulation will need to build back up.
As a result, even with a 0.5% fall this quarter, I’m not sure if we are going to see an Aussie recession (two quarters of negative growth) quite yet …
Of course – the steep fall in their terms of trade is concerning – but that is a story for when I’m actually able to think 🙂