Australia's leading index dropped further in October suggesting that growth will slow substantially next year, Westpac said on Wednesday.
The six-month annualized growth rate in the Westpac-Melbourne Institute Leading Index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, fell to -1.19 percent in October from -1.09 percent in September.
Westpac forecast the Australian economy to grow at a slower pace of 1 percent in 2023 from around 3.4 percent this year.
Key drivers of the slowdown are monetary policy tightening, falling commodity prices, and softness in jobs growth as capacity constraints bite, Westpac said.
Bill Evans, Westpac chief economist said the Reserve Bank is set to raise its cash rate again by a quarter point in December.
