Roseville is poised for a wave of new apartment development following the NSW Government's rezoning of land around Roseville Station under its Transport Oriented Development program.

The new planning controls have unlocked significant development potential within walking distance of the station, with a number of sites expected to be amalgamated and redeveloped in the coming years as developers seek to take advantage of the increased density allowances.

One of the more restrained developments in the precinct, and set among the first to be delivered having commenced well before the recent changes, is Hyecorp's Juliet. The boutique apartment project is already well under construction and remains on track to welcome residents by the end of the year, offering a markedly different proposition to many of the larger-scale developments now likely to emerge across the suburb.

[smartcode_project:default project_id=7395 project_image_fid=278194]

<a href="https://www.apartments.com.au/new-apartments/juliet-roseville-64-pacific-highway-roseville-nsw-2069">Juliet</a> will comprise just&nbsp;34 one-, two-, and three-bedroom apartments opposite Roseville Station. For Hyecorp, which has delivered projects across Sydney's Lower North Shore for more than three decades, Roseville presented a rare opportunity to address a growing gap in the market.

"<a href="https://www.apartments.com.au/developments/roseville-nsw-2069">Roseville</a> has long been one of the North Shore's most tightly held and desirable suburbs, offering a unique combination of village charm, established greenery, excellent transport connections, and proximity to some of Sydney's best schools and lifestyle amenities," Hyecorp said.

"We recognised a growing demand from local homeowners seeking to downsize without leaving the community they have built their lives around. The location presented a rare opportunity to create homes that cater specifically to that buyer profile."

[smartcode_project:default project_id=7395 project_image_fid=278196]

The six-level development has been designed by <a href="https://www.apartments.com.au/architects/pbd-architects">PBD Architects</a> as a collection of residences that feel more like homes than apartments. The brief centred generous floorplans, abundant natural light, quality finishes, and strong connections to outdoor space.

PBD Architects drew inspiration from Roseville's established garden suburb character, creating a building that sits comfortably within its surroundings rather than dominating them. The architecture incorporates natural materials, soft forms, layered landscaping, expansive balconies, and generous setbacks to strengthen the connection between residents and the suburb's leafy environment.

"The focus was on designing spacious, house-like residences for discerning owner-occupiers and downsizers who wanted to remain on the North Shore without compromising on comfort, privacy, or design," PBD said.&nbsp;

"Every apartment was to feel considered, timeless, and highly functional."

[smartcode_project:default project_id=7395 project_image_fid=278195]

Inside, residences feature engineered timber flooring, stone kitchen benchtops and splashbacks, integrated Fisher &amp; Paykel appliances, ducted air conditioning, and large outdoor entertaining areas designed to take advantage of district and treetop views.

Residents will also have access to a rooftop barbecue and lounge area, alongside practical amenities including parcel lockers, EV charging capability, bicycle storage, a dog wash bay, and a basement car wash facility.

The majority of purchasers so far have been local owner-occupiers from Roseville, Lindfield, Chatswood, Killara, and the broader Upper North Shore, many of whom are transitioning from larger family homes.

"Buyers are looking for spacious, house-like apartments that allow them to downsize without feeling like they are sacrificing comfort or functionality," Hyecorp noted.

"They value large kitchens, generous living areas, ample storage, quality finishes, secure parking, lift access, and low-maintenance living."

[smartcode_project:default project_id=7395 project_image_fid=278204]

Juliet sits directly opposite Roseville Train Station and within walking distance of Roseville Village, while Chatswood's retail and dining precinct is only minutes away. The development is also surrounded by some of Sydney's most established schools, including Roseville College, Ravenswood, Pymble Ladies' College, and Knox Grammar, as well as nearby parklands and golf courses.

Juliet is currently more than 75 per cent sold ahead of its anticipated completion in late 2026.

[smartcode_project_cta:default project_id=7395]

Joel Robinson

Juliet to sit quietly amid Roseville apartment boom

Sherpa Property Group has unveiled the third instalment of its Flourish series, securing full approval for the two-tower, $500 million Flourish Soleira development in Palm Beach.

<a href="https://www.apartments.com.au/new-apartments/flourish-soleira-1150-1154-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> will rise from a prominent site in the commercial heart of Palm Beach, the long-time home of Cash Converters and a range of local retailers.

The project will introduce a new retail and dining precinct at ground level, beneath 286 apartments.

[smartcode_project:default project_id=150017 project_image_fid=370959]

“We’re very committed to not only providing affordable residential offerings that are much needed in Palm Beach, but also delivering a vibrant new commercial heart that complements the extraordinary growth of the southern Gold Coast,” Sherpa Property Group founder Christie Leet said.

The development will sit under Sherpa's Flourish brand, which is aimed at providing a pathway into the beachside suburb for locals, first-home buyers and downsizers. In a move designed to assist first-home buyers entering the market, Sherpa has reserved all one and two-bedroom, one-bathroom apartments exclusively for eligible first-home buyers.

[smartcode_project:default project_id=150017 project_image_fid=370964]

“Our vision through Flourish is to create a vibrant retail and lifestyle focal point within the Palm Beach centre zone, delivering thriving communities underpinned by lifestyle-rich locations,” Leet said.

“So far, Flourish has been an incredible success, and we hope to carry this momentum as we progress the next two Flourish projects in Palm Beach.”

[smartcode_project:default project_id=150017 project_image_fid=371430]

Located across 1150-1164 Gold Coast Highway and 3 Sixth Avenue, the development will comprise two towers. The northern tower will deliver 154 apartments, while the southern tower will add a further 132 residences, helping address ongoing demand for new apartments in the tightly held coastal suburb.

Flourish Soleira will also feature the most extensive rooftop amenity offering ever delivered in Palm Beach.

The two towers will be connected by a skybridge, with residents gaining access to a rooftop recreation deck featuring a full-width swimming pool, hot and cold plunge pools, wellness spaces, a gymnasium, private dining facilities, massage treatment rooms, barbecue areas, a basketball court, golf simulator, indoor and outdoor dining spaces, sun lounges and extensive landscaping.

LPS Group is expected to start construction later this year.

Sherpa is already well advanced on construction of its debut Flourish project, Flourish Amargo, located just around the corner from Soleira. Meanwhile, Flourish Oasis, positioned opposite Amargo, recently commenced construction and has nearly sold out its collection of 47 apartments.

[smartcode_project_cta:default project_id=150017]

Sherpa unveils $500m mixed-use Palm Beach precinct, Flourish Soleira

Are mortgage holders set to get a reprieve from the RBA in 2026?

Big Four bank NAB believes so. They are now expecting the next move from the RBA to be a cut, rather than a hike, which they had pencilled in for August. They are unsure of the timing of the cut however, they note in their latest&nbsp;NAB Economics RBA Watch.

NAB Chief Economist, Dr Sally Auld, said recent data suggests the economy has lost momentum and the outlook for rates has shifted, noting that the broader economic backdrop has changed since earlier in the year.

“The next move in the cash rate is likely to be down, but the timing is uncertain," Dr Auld said.

"In February, growth was above trend, the economy was operating above capacity and there was uncertainty over the restrictiveness of rates. None of these conditions exist today,” she outlined.

Dr Auld said recent data pointed to softer momentum across the economy while acknowledging that at the same time, uncertainty remains a key feature of the outlook.

“Both Q1 GDP data and the NAB business survey suggest momentum in the economy has slowed, meaning that growth has likely peaked for the cycle. That said, we are cognisant there is still considerable uncertainty around the outlook, both with respect to activity and inflation.”

Dr Auld said inflation risks and labour market outcomes would be important to watch.

“On the prices side, we are still forecasting above target core inflation through to mid-2027. Margins will compress and weaker labour market outcomes are a risk.”

She said tighter financial conditions are expected to weigh on housing and activity.

“Tighter financial conditions will be reflected in a slowing in house price growth and housing credit growth. In summary, we have greater conviction that the next move in rates is down, but less conviction on the timing.”

Mortgage relief? NAB forecasts RBA rate cut, not hike, after softer economic conditions

A local downsizer has splashed $6.5 million on a penthouse in Perifa's Alex &amp; Willow development in Crows Nest. 
&nbsp; 
The purchaser sold their long-held family home in the area before embarking on a six-month search for the right apartment. After inspecting a range of options across the Lower North Shore, the buyer returned to <a href="https://www.apartments.com.au/new-apartments/alex-willow-crows-nest-82-90-alexander-street-crows-nest-nsw-2065">Alex &amp; Willow</a>. 
&nbsp; 
The buyer profile reflects the project’s broader purchaser mix. <a>Alex &amp; Willow</a> has attracted predominantly local downsizers looking to transition from larger homes without compromising on space or quality, alongside a smaller cohort of upsizers and investors drawn to the project’s location and design credentials. 
&nbsp; 
The milestone sale comes as the project, developed by&nbsp;<a href="https://www.apartments.com.au/developers/perifa">Perifa</a>&nbsp;and delivered by <a href="https://www.apartments.com.au/builders/versatile-made-construction">Versatile Construction</a>, both part of Versatile Group, reaches 60 per cent sold.

[smartcode_project:default project_id=6680 project_image_fid=371325] 
&nbsp; 
Eddie Mansour, Managing Partner of <a href="https://www.apartments.com.au/project-marketer/ray-white-projects">Ray White Projects</a>, said the result demonstrates not only a headline price but also depth of demand. 
&nbsp; 
“This is an exceptional outcome and a clear reflection of sustained buyer demand for premium, well-located downsizer product,” Mansour said.

“We’re seeing a consistent pattern of local homeowners selling family residences and reinvesting into high-quality apartments that allow them to remain within their community. Alex &amp; Willow has resonated strongly with this group because it offers genuine scale, thoughtful design and immediate proximity to the village.” 
&nbsp; 
The sale reflects a broader and consistent trend of local downsizers actively seeking high-quality, low-maintenance residences close to established village centres. Agents report that demand for this product type has remained resilient, particularly where developments offer a rare combination of scale, design quality and walkable amenity. 
&nbsp;&nbsp; 
Fabrizio Perilli, Managing Director of Perifa and Versatile Group, said the sale marks a defining moment for the project. 
&nbsp; 
“The penthouse sale is a strong endorsement of the quality we have delivered, alongside our partners, and the clear demand from local downsizers for premium, boutique residences in this location,” Perilli said.&nbsp; 
&nbsp; 
“Most importantly, we’re proud to see the Alex &amp; Willow community beginning to take shape. As we move closer to completion, we’re looking forward to welcoming residents and seeing the project come to life.”&nbsp;

[smartcode_project:default project_id=6680 project_image_fid=338516] 
&nbsp; 
Designed by <a href="https://www.apartments.com.au/architects/nettletontribe">Nettleton Tribe</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/richards-stanisich">Richards Stanisich</a>, Alex &amp; Willow is a boutique collection of generously sized two- and three-bedroom residences in the heart of Crows Nest village.&nbsp;

Completion is slated for early 2027.

[smartcode_project_cta:default project_id=6680]

Alex & Willow, Crows Nest penthouse sells off the plan for $6.5 million

Fresh from launching the first stage of its Wollongong precinct, <a href="https://www.apartments.com.au/new-apartments/keira-place-wollongong-120-122-smith-street-wollongong-nsw-2500">Keira Place</a>, builder-developer Urban Property Group has unveiled plans for the next phase of the masterplanned community.

Now on public exhibition through the NSW Government's Housing Delivery Authority pathway is a State Significant Development Application for a further 657 homes on the prominent gateway site opposite Beaton Park.

The proposal comprises three buildings, including two build-to-sell towers rising 25 and 30 storeys, delivering 391 apartments, alongside a 12-storey co-living building with 266 residences, making it one of the largest co-living proposals currently planned in regional New South Wales.

Of the apartments proposed in the build-to-sell towers, the majority, 310, are two-bedroom dwellings. The balance comprises 44 one-bedroom apartments and 37 three-bedroom residences. Apartment sizes range from around 50 sqm for one-bedroom homes to approximately 90 sqm for three-bedroom apartments.

<img alt="Smith St" data-entity-type="file" data-entity-uuid="19347059-1612-41a0-9c74-b86a657237f8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%2010.02.18%E2%80%AFAM.png?VersionId=sWXnaCcA.cIC6N8YT1dg5pJ2e1V3Z6z7" />

The submission says the proposal has evolved significantly from its original Housing Delivery Authority application following extensive consultation with the State Design Review Panel and Wollongong City Council.

The final scheme has been designed to align with the emerging vision for the Flinders Street Precinct, an area identified by Council as a future high-density mixed-use neighbourhood capable of accommodating substantial housing growth close to transport, employment and community infrastructure.

According to the design report prepared by COX Architecture, the development aims to "deliver a built outcome consistent with the future character of the Wollongong CBD while responding to the site's unique constraints and opportunities."

"Our vision for the next phase of the site evolution in Wollongong is grounded in three design pillars that guide the design response: place, natural environment and celebration," COX said.

"Inspired by its surroundings and grounded in the stories of place on Wodi Wodi Country, the design proposal acknowledges the established character of its setting while creating a unique and timeless identity that sits harmoniously within it.

"The design proposal responds to its specific site conditions, acknowledging the vegetation, climate, wind conditions and solar access of the site."

The architecture responds directly to the site's position between Wollongong's urban core and its natural landscape setting.

COX identified views towards Mount Keira and the Illawarra Escarpment as defining features of the site, while the upper levels of the towers will also capture expansive views across the city and out to the Pacific Ocean.

The design team has positioned the tallest buildings closer to the rail corridor, where overshadowing impacts can be better managed while establishing a landmark built form on the northern approach into the city.

<img alt="Smith St" data-entity-type="file" data-entity-uuid="79580d5b-500c-4ebf-9629-797146a4a694" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%209.51.59%E2%80%AFAM.png?VersionId=WbTB1EKSG.KDfsfz0F3wp1QVa2oCMGR5" />

Urban Property Group secured the 11,000 sqm Smith Street site in 2022 and has since progressed plans for the broader Keira Place precinct.

Construction recently commenced on the first stage of Keira Place, which will deliver 150 apartments across two residential buildings, including 27 affordable housing apartments and 18 specialist disability accommodation dwellings, alongside activated ground-floor retail and commercial space.

Urban Co-CEO Patrick Elias said the commencement of construction marked a significant milestone for Wollongong and reflected the developer's long-term commitment to regional cities.

"Today's groundbreaking is about turning approvals into homes and moving quickly to deliver much-needed housing in Wollongong's city centre," Elias said.

"Keira Place will provide a diverse mix of homes close to jobs, transport and services, while setting a high benchmark for quality, durability and consumer protection."

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/groundbreaking-marks-start-of-construction-at-keira-place-in-wollongong-cbd">Groundbreaking marks start of construction at Keira Place in Wollongong CBD</a>

&nbsp;

&nbsp;

&nbsp;

Urban Property Group unveils trio of towers for next stage of new Wollongong precinct, Keira Place

Meeting Minutes

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The RBA have suggested that the there will be another cut later in the year.
"Financial market pricing implied that the cash rate target was expected to be lowered by 25 basis points at the present meeting, with a further 25 basis point reduction expected later in the year," the RBA said in their June 2019 meeting minutes.
"Given the amount of spare capacity in the labour market and the economy more broadly, members agreed that it was more likely than not that a further easing in monetary policy would be appropriate in the period ahead."
The meeting minutes highlighted that the Coalition government win, paired with APRA's announcement that they will loosen their lending standards, will effect the housing market.
The RBA Governor Philip Lowe said in the June meeting minutes that it is too early to determine the overall effects, however he cited the auction clearance rates in Sydney "increasing noticeably following these developments."
"Members noted that the housing market was likely to be affected by the removal of uncertainty around possible changes to taxation arrangements relating to housing," Lowe said.
"They also considered the effects of the Australian Prudential Regulation Authority's (APRA's) proposal to amend its requirement for banks to determine the borrowing capacity of loan applicants using a specified minimum interest rate."
The RBA noted that building approvals declined further in April to be more than 20 percent lower over the preceding 12 months.
"This suggested that, even if there were a marked turnaround in housing sentiment, given the lags involved it would take some time for this to translate into higher residential construction activity," Lowe added.
Lowe said housing credit had stabilised in recent months, having slowed substantially over the preceding year.
One of the biggest segments the RBA were monitoring when considering cutting the official interest rate was the labour market.
"The data on conditions in the labour market in April had been mixed," Lowe said.
"Members noted the significant uncertainty around modelled estimates of the unemployment rate consistent with full employment.
"The unemployment rate had increased to 5.2 per cent in April from (an upwardly revised) 5.1 per cent in March.
"This followed a six-month period during which the unemployment rate had remained at around 5 per cent. 
"The increase in the unemployment rate had been accompanied by an increase in the participation rate to its highest level on record. 
To read the full minutes, <a href="/expert-insights/finance/minutes-of-june-2019-monetary-policy-meeting-of-the-reserve-bank-board">click here</a>.
 
 
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jrobinson-rf4aSBido9

Further cash rate cut expected later in the year: RBA June 2019 meeting minutes

Minutes of June 2019 Monetary Policy Meeting of the Reserve Bank Board

Minutes of April 2019 Monetary Policy Meeting of the Reserve Bank Board

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Despite pressures to cut rates, the RBA have held firm, suggesting there is no need for an adjustment to the cash rate in the near term.
"Members agreed to continue to assess the outlook carefully," RBA Governor Philip Lowe said in the <a href="/expert-insights/finance/minutes-of-march-2019-monetary-policy-meeting-of-the-reserve-bank-board">March meeting minutes</a>.
"Given that further progress in reducing unemployment and lifting inflation was a reasonable expectation, members agreed that there was not a strong case for a near-term adjustment in monetary policy.
"Rather, they assessed that it would be appropriate to hold the cash rate steady while new information became available that could help resolve the current tensions in the domestic economic data."
On housing, Lowe said the process of adjustment in the housing market had continued. 
"Housing prices in Sydney, Melbourne and Perth had declined further, and turnover in the housing market had fallen significantly," he said.
Lowe noted that available data showed continued declines in Sydney, Melbourne and Perth into 2019, however also said the data was difficult to interpret when taking into account the always quiet January period.
"In Sydney, housing prices were 13 per cent lower than their July 2017 peak, while in Melbourne housing prices were 10 per cent lower than their November 2017 peak," Lowe suggested.
He highlighted the auction clearance rates picking up in Sydney and Melbourne over February, although added that demand for housing credit had slowed 'noticeably' as conditions in the housing market changed.
Lowe noted that despite the likelihood dwelling investment was expected to decrease in the December quarter, however the pipeline of work to be done remained large.
"Members noted that the pipeline of work to be done remained large and was expected to support dwelling investment through 2019, particularly in New South Wales and Victoria," Lowe said, although added there will be a marked slowing in dwelling investment soon.
"Residential building approvals and information from the Bank's liaison program pointed to a marked slowing in dwelling investment in one to two years' time, unless pre-sales increased significantly in the following few quarters.
"The recent weakness in sales of detached new houses had been most pronounced in Sydney and Melbourne, but had also been evident in other locations.
"Contacts had reported that tighter access to credit for off-the-plan and project homes had been constraining buyer demand," Lowe said.
The RBA are still hopeful of growth in GDP of around three percent of 2019 and a further decline in the unemployment rate to 4.75% over the next couple of years.
 
 
 
 
 
 
 
 
 
 
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No strong case for cash rate hike as housing turnover 'falls significantly': RBA March 2019 minutes

Minutes of March 2019 Monetary Policy Meeting of the Reserve Bank Board

Minutes of February 2019 Monetary Policy Meeting of the Reserve Bank Board

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The RBA's minutes for the December cash rate meeting have noted demand for off the plan apartment had declined significantly since mid-2017.
The RBA also suggested that liaison with developers indicated that demand for new detached housing in eastern Australia had eased over the previous year or so and some developers had reported that this decline in demand had become more pronounced.
"Given the substantial amount of work outstanding and recent data on dwelling approvals, dwelling investment was expected to remain around this level for at least the following year or so before moderating," it noted.
They said that dwelling investment has continued around its recent high level in the September quarter, and given the substantial amount of work outstanding on dwelling approvals, dwelling investment was expected to remain around this level for at least the following year or so before moderating.
Again Sydney and Melbourne were the main housing localities for the eastern capital decline. 
"Members observed that housing prices had fallen across all price segments in Sydney," the minutes noted, adding house prices had fallen by around nine percent since September 2017 to be around their September 2016 levels.
They said Melbourne levels have dropped back to what they were around March 2017, having seen a decline of just under six percent since their November 2017 peak.
"Auction clearance rates and indicators of private-treaty activity had also declined a little further in both cities," the RBA also added.
Despite the property market decline, the RBA found that, having liaised with retailers, that underlying trading conditions had been stable.
Surveys suggested that households' views about their financial situation had remained around average.
For the full RBA minutes <a href="/expert-insights/finance/downsize-risks-acknowledged-in-december-2019-minutes-of-reserve-bank-board">click here</a>.
 
 
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RBA notes developers report demand for off-the-plan apartments has declined significantly: December meeting minutes

jonathanchancellor-7SQnKwU6yx

Downsize risks acknowledged in December 2019 Minutes of Reserve Bank Board

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<div>
EXPERT OBSERVER
Consumer sentiment: The ANZ-Roy Morgan consumer confidence rating fell by 1.7 per cent to 117.8 in the past week. The index is well above the average of 114.2 held since 2014, and above the longer-term average of 113.0 held since 1990.
Reserve Bank Board minutes: The minutes from the November 6 Board meeting were issued. While no rate change is expected any time soon, the Board continues to believe that the next move in rates will be up. Board members see risks of a bigger decline in the jobless rate and thus risks of higher wage growth.
The IMF 2018 Article IV Consultation Mission: The IMF said that “The [Australian] economy’s strong growth momentum is expected to continue in the near term. Notwithstanding recent strong growth, it is not yet the time to withdraw macroeconomic policy support given remaining slack.”
The consumer confidence figures have implications for retailers, and other consumer-focussed businesses. The Reserve Bank Board minutes provides guidance on interest rate settings.
</div>
<div class="x_WordSection2">
<h1>What does it all mean?</h1>
The Reserve Bank Board undertook its annual review of forecasts and concluded that forecast errors had been lower than ‘average’ or normal. Members of the Board also ran different scenarios to assess the impact on interest rates and also ran scenarios to judge the impact on Australia of higher US wage and price growth. Overall, it seems clear from the text that the Reserve Bank Board is comfortable with how things have played out over 2018 and is comfortable with current interest rate settings.
While the Reserve Bank continues to watch the US-China trade dispute, it remains upbeat, believing that growth of Australia’s trading partners will “remain above potential in 2019.” However the Board did note “the latest forecasts had incorporated a small negative effect from recent tariff changes on growth in a number of economies, including the United States and some east-Asian economies.”
There are definitely no signs of angst expressed by Reserve Bank Board members.
Consumer confidence fluctuates from week-to-week. Over the year to November 18, the ANZ-Roy Morgan sentiment gauge has averaged 118.5 points, broadly in-line with current levels of confidence. 
The sharpest falls in weekly sentiment have occurred around political events this year – the Liberal Party leadership crisis (“Libspill”) and Wentworth by-election, respectively in August and October. Of course, households will be navigating three elections in the coming months with Victoria, New South Wales and Federal polls ahead. Business and consumer confidence will likely be choppy in this environment. 
That said, sentiment is holding-up remarkably well, given that home prices have been falling in Sydney, Melbourne and Perth for over a year. And the Aussie sharemarket touched 20-month lows today, down by almost 7 per cent (ASX200 index) so far this year. Importantly, consumer views about the state of their finances and economic conditions are still all above their long-run average levels.
<h1>What do the figures show? </h1>
Consumer Sentiment
The ANZ-Roy Morgan consumer confidence rating fell by 1.7 per cent to 117.8 in the past week. The index is well above the average of 114.2 held since 2014, and above the longer-term average of 113.0 held since 1990. 
Three of the five components of the index decreased last week:
The estimate of family finances compared with a year ago was down from +15.2 to +6.7; 
The estimate of family finances over the next year was down from +27.5 to +25.2;
Economic conditions over the next 12 months was down from +11.7 to +9.9; 
Economic conditions over the next 5 years was up from +15.1 to +16.6;
The measure of whether it was a good time to buy a major household item was up from +29.5 +30.7.
The measure of inflation expectations fell from 4.3 per cent to 4.2 per cent.
Reserve Bank November Board minutes:
On the economy: “Members noted that the recent run of economic data suggested that growth in the Australian economy had been higher over the year to the June quarter than earlier forecast, and above estimates of potential growth. Labour market conditions had remained strong and other available indicators pointed to further solid GDP growth in the September quarter. At the same time, inflation in the September quarter had slowed as expected, partly as a result of a large policy-induced decline in childcare prices.”
On the job market: “Conditions in the labour market had also been stronger than expected and forward-looking indicators of labour demand continued to point to ongoing strength in the near term. As a result, the forecast for the unemployment rate had been revised lower and the forecast for wages growth had been revised slightly higher.”
Good economic forecasts: “As part of a regular annual review process, members considered how the domestic economy had evolved over the preceding year relative to the Bank's forecasts of a year earlier. Members noted that the magnitude of forecast errors for key variables, including GDP growth, the unemployment rate and inflation, had been smaller than the historical averages.”
Global risks: “Members noted that the direction of international trade policy continued to be a significant risk to the global outlook.”
Money market conditions: “Information from liaison suggested that there had been little change in domestic money market conditions in recent months. The modest increase in funding costs earlier in the year had been passed on by most lenders to existing borrowers with variable-rate business and housing loans.”
Residential developments: …”there had been reports that bank financing of large development projects had become more difficult, particularly in areas where there had already been substantial development.”
<h1>What is the importance of the economic data?</h1>
The ANZ/Roy Morgan weekly survey of consumer confidence closely tracks the monthly Westpac/Melbourne Institute consumer sentiment index but the former measure is a timelier assessment of consumer attitudes and is now closely tracked by the Reserve Bank.
The Reserve Bank releases minutes of its monthly Board meeting a fortnight after the event. The minutes give a guide to Reserve Bank thinking on interest rate settings.
<h1>What are the implications for interest rates and investors?</h1>
Consumers remain positive. But the real test will come over the next month for Aussie retailers in the lead up to Christmas. And department stores will again be under pressure this week with the Black Friday and Cyber Monday mega online sales kicking-off. <a href="http://finder.com.au/" target="_blank">Finder.com.au</a> estimates that Aussie consumers will splurge around $320 million on goods.
The Reserve Bank reiterated in its Board meeting minutes today that the outlook for consumption remained uncertain given slow income growth, high mortgage debt levels and cooling housing markets. But wages growth appears to have bottomed, interest rates remain at very supportive record-low levels and utilities bills and petrol prices have fallen from their most recent peaks. And of course 180,200 full time jobs (out of a total of 308,100 job gains) have been created over the past ten months. 
With elections ahead, the IMF has weighed in with its views on its wish-list for Aussie policy reforms. The Fund suggested that “broad tax reform to support productivity and inclusive growth would be desirable…. These reforms should be combined with reforms to raise the GST revenue, lower the company tax rate more broadly, and reduce tax concessions.” On research and development reforms, the IMF said that “The recommendations of the science agenda laid out in Australia 2030: Prosperity through Innovation are constructive and should be implemented.” And on housing, “Housing supply reforms will be critical to restoring housing affordability.”
CommSec expects no change in the official cash rate until later in 2019. However, just like Reserve Bank Board members, we are closely watching trends in the job market and wages. The Reserve Bank is uncertain about the extent of spare capacity in the job market and therefore this has implications for wage growth.
Ryan Felsman is a senior economist at CommSec.
 
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Reserve Bank upbeat on Aussie economic growth: CommSec

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EXPERT OBSERVER
The minutes of the November monetary policy meeting of the Reserve Bank Board confirm the confident approach we have seen in the recent Statement on Monetary Policy.
While consumption growth is still identified as a source of uncertainty, the Board expects it to remain around the 3% level over the next few years that we have seen recently. Household disposable income growth is also forecast to increase at that rate.
GDP growth and labour market conditions had been stronger than the Bank had expected over the last twelve months. Accordingly, the forecast for the unemployment rate had been lowered to 4 ¾ per cent from 5 per cent by mid-2020, with an implied downside risk to that forecast. With the improved labour market outlook, there has been a modest upward revision to the outlook for wages growth. This is a particular encouraging development for the Bank as they see wages growth as the key uncertainty for future consumption growth and inflation.
In that regard, the forecast for inflation has been lifted modestly, reflecting the brighter outlook for economic activity, the labour market and wages.
Despite a disappointing capex survey, non-mining business investment was expected to continue to make a significant contribution to output growth supported by above average business conditions and the significant pipeline of non-residential construction work.
Their discussion around the housing market is a little less confident. Residential building approvals are recognised to have fallen in the September quarter and liaison with builders paints a difficult picture. Furthermore, it is noted that housing prices have fallen further in Sydney and Melbourne, although are stable in most other cities. With the Bank’s core forecast that consumption and income growth will be aligned, there is no allowance for any negative wealth effects from these housing developments. The minutes discuss the various policy stances of other central banks noting that “market pricing was consistent with policy rates remaining steady over the following year in Australia and New Zealand, where policy rates had not been lowered to the extent they had in some other economies”.
The Board also discussed the Bank’s forecasting performance over the previous year, noting that forecast errors were smaller than historical averages with GDP growth and business investment surprising to the upside, the terms of trade average being higher than expected, and the marked depreciation in the Australian Dollar. Labour market outcomes were also stronger than expected, although wages growth and inflation had evolved largely as expected. This assessment supports the gradualist policy approach supported by growth holding above potential with associated declining spare capacity leading to a gradual increase in wages growth and inflation.
There is also a rather curious discussion around arguments that had been advanced by various commentators. The arguments are set out but they make no qualitative assessment of their reliability.
We know that the Governor has noted that interest rates could be cut in the event of a global shock and it is interesting that the minutes point out that the monetary policy response to that shock would depend on the associated move in the exchange rate.
The final section of the minutes once again emphasises the importance of wages growth. It is noted that there has been a noticeable pick-up in wages growth in most advanced economies, and Australia requires “a gradual increase in wages growth for inflation to be sustainably within the target range”.
As in the section of the minutes on the domestic economy, the concluding section leaves the discussion around housing markets somewhat up in the air. Credit conditions are recognised as being tighter than they had been for some time, but lending rates remain low and there was strong competition for borrowers of high quality.
In the final paragraph in the minutes, the Board emphasises that “there was no strong case for a near-term adjustment in monetary policy”, although the comment “since progress on unemployment and inflation was likely to be gradual” which featured in the October minutes was not used in these minutes. Based on the confident assessment in the body of the minutes, it is possible that the Board is a little more confident with its view that the next move in the cash rate will be an increase.
Conclusion
This is a balanced set of minutes but does indicate more confidence from the Board around its growth, employment, wages and inflation views. The outlook was also boosted by the expectation that consumption and income growth will hold at 3% despite slowing employment growth, and risks around the housing market in Sydney and Melbourne.
By noting that market pricing is not expecting a policy adjustment for the next year, the Bank does appear to be extremely patient with its next policy move. Westpac expects that their growth forecast for 3 ¼ per cent growth in 2019 is too high, mainly because of an expected downturn in residential construction, a slowdown in consumption growth associated with weaker income growth and some wealth effects. That development alone is likely to take the edge off the expectation of rising wages and higher inflation.
We retain our view that the cash rate will remain on hold in 2019 and 2020.
BILL EVANS is the chief economist of <a href="https://www.westpac.com.au/" target="_blank">Westpac</a>.
 
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<a id="LPlnk633217" class="OWAAutoLink" href="https://www.rba.gov.au/monetary-policy/rba-board-minutes/2018/2018-11-06"> </a>
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