New data to give guide on lockdown impact

New figures will provide a guide to how big the impact from lockdowns in the nation's two most populous states will likely have on the economic growth outlook.

The August Westpac-Melbourne Institute leading index - which indicates the likely pace of economic activity three to nine months into the future - is released on Wednesday.

While the index has been pointing to a slowing economy due to lockdowns in NSW, Victoria and ACT, it has so far indicated growth holding above the long-term trend of 2.8 per cent.

However, Westpac economists expect the August reading will reveal the full impact of the coronavirus Delta variant, sending growth reeling below trend.

This will be the result of the sharp drop in hours worked as reported in last week's labour force data for August, and declines in other components, such as falling dwelling approvals and commodity prices.

In a recent speech, Reserve Bank of Australia governor Philip Lowe warned the economy could contract by at least two per cent in the September quarter, while economists expect it could be as much as four per cent.

The minutes of the RBA's September 7 board meeting, released on Tuesday, predicted the rebound once COVID-19 restrictions are eased could be slower than experienced when previous lockdowns have ended.

This would be the result of consumers and businesses being more cautious after lengthy shutdowns.

RBA assistant governor for the financial system Michelle Bullock is due to make a lunchtime online address to a Bloomberg event on Wednesday.

The National Skills Commission will also release its final report on job vacancies online on Wednesday, a pointer to future hiring intentions among businesses.

Its preliminary report showed job ads fell 5.6 per cent in August, a third consecutive monthly decline after striking a 12-year high in May.

Austrlaian Associated PressBack to Breaking News

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