The Reserve Bank has identified a number of major influences on the Australian economy at present:
- sovereign debt problems in Europe;
- changes in household spending patterns;
- softness in the housing market;
- the investment and terms of trade boom (business investment rose about 20% in the last year); and the
- high exchange rate.
The Australian economy is currently experiencing an unusual, if not unprecedented, set of circumstances, with an investment and terms of trade boom combined with the high Australian dollar. The boom, however, is not evenly spread across all sectors. The Reserve Bank has noted that whilst the outlook for mining investment is strong (it increased by more than 50% in the year to September 2011), other industries are being impacted by the high Australian dollar, the tight credit conditions and declining public investment. The high exchange rate particularly affects manufacturers, and the tourism and education sectors by making Australia less competitive internationally. Further, changes in household spending are affecting the manufacturing, building construction and retail industries.2
This April 2012 edition of Economics Indicators: NSW updates statistical information on key economic indicators, thereby presenting an updated snapshot of the NSW economy and providing relevant points of comparison with other Australian States and Territories.