FX.co ★ Australia Leading Index Down Slightly

The Westpac-Melbourne Institute Leading Economic Index for Australia recorded a 0.1% decline in August 2025, following a 0.1% increase in July. Additionally, the six-month annualized growth rate decreased to 0.16% from 0.1%, marking its first below-trend performance since late 2024. This indicates a clear slowdown from earlier this year's above-trend momentum. The trend suggests that growth is tapering after a strong second quarter. Westpac anticipates a GDP growth of 1.9% for 2025, an improvement from 1.3% in 2024, although still marginally below trend, with expectations of returning to trend in 2026. Given the firmer-than-expected inflation and consumer demand, the Reserve Bank of Australia (RBA) is projected to maintain the cash rate at 3.6% during its September meeting. Nonetheless, evidence of decelerating growth could pave the way for a 25 basis point cut in November, with two additional cuts anticipated in 2026.