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Speaker 1: Morning, seven past seven. Who doesn't love GDP day? Are

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Speaker 1: we still in recession or not? It's the print for

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Speaker 1: Q one. Jan Febin March Banks A split Westpac, que

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Speaker 1: Bank B and z C of four A and zed

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Speaker 1: ASBC growth. Westpac senior economist Michael Gordon with us, good morning,

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Speaker 1: Good morning. As far as the banks are concerned, you're

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Speaker 1: at the negative end of the spectrum. Why you there

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Speaker 1: and others are up? How are you down? And there up? Well?

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Speaker 2: I think firstly, everyone's in a pretty similar range. It's

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Speaker 2: either slightly above or slightly below zero growth. And bearing

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Speaker 2: in mind this is when we've also still had some

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Speaker 2: pretty strong population growth through that time, you'd think that

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Speaker 2: would provide a little bit of a baseline of growth and activity.

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Speaker 2: But I think everyone's saying was sort of backwards in

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Speaker 2: per person.

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Speaker 1: Terms exactly, So carry on.

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Speaker 2: I think in terms of detailed I would just like

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Speaker 2: to highlight this where we see the weakness. It is

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Speaker 2: concentrated in a few areas, like building. It's not necessarily

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Speaker 2: a widespread scene. But that said, that's not really any

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Speaker 2: area that standing out is particularly strong at the moment.

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Speaker 1: Okay, so's say you're right for Q one can we

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Speaker 1: write Q two off, which we're just about to wrap up.

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Speaker 1: In other words, Q two can't have been better than

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Speaker 1: Q one.

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Speaker 2: No, it's not looking great, and we do have a

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Speaker 2: small minus penciled into that one as well as some

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Speaker 2: of the indicators are coming in. It's you know, it's

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Speaker 2: certainly not looking flash at the moment, and I think

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Speaker 2: it's really a story of it's it's probably going to

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Speaker 2: be something either side of zero growth or for much

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Speaker 2: of this year.

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Speaker 1: Yeah, I was going to say, because I can't see

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Speaker 1: what it is that happens. We all seem to be

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Speaker 1: holding out for some miracle that the expert returns go

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Speaker 1: through the roof, or Adrian says my mistake and I'll

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Speaker 1: start cutting left, right, and center.

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Speaker 2: Now.

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Speaker 1: I don't see either thing like that happening to you.

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Speaker 2: Yeah, I mean, I think the most likely catalyst will

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Speaker 2: be on the interest rate side. Once we get I guess,

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Speaker 2: some convincing evidence that inflation pressures are coming down and

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Speaker 2: staying down where they should be, then there'll be room

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Speaker 2: for interest rate relief. And it's really just a question

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Speaker 2: of when that happens. I mean, we're kind of talking

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Speaker 2: early next year for the first cuts reserve banks trying

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Speaker 2: to put out a signal of something even later into

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Speaker 2: next year. But I do think there's probably an issue

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Speaker 2: of there are a lot of people that thought would

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Speaker 2: be having them now and they haven't happened, and you know,

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Speaker 2: they haven't really planned to that.

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Speaker 1: What's the level of pain that you're really seeing that

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Speaker 1: the headlines will tell us people are screaming, doors are closing,

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Speaker 1: wallets are shut. Adrian goes, Oh, this is all going

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Speaker 1: to plan. What's the real story?

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Speaker 2: Yeah, I mean, I think this is the reality of

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Speaker 2: what it's like to live through a recession from day

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Speaker 2: to day. I think it's we easily forget that and

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Speaker 2: we see it as a few points on a chart

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Speaker 2: in history, but actually living through it, you do get

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Speaker 2: these kind of stories. I mean, I think the best

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Speaker 2: gauge of where we are, where the economy is right now,

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Speaker 2: I always synthesize, is it's really down employment rates. So

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Speaker 2: whereas it now four point three percent, that's not terribly high.

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Speaker 2: In fact, there's probably one of the lower rates we've

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Speaker 2: head in history. But it is rising and you know,

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Speaker 2: no one thinks it's going to stop here. We're expecting

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Speaker 2: that to peak at about five and a half percent.

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Speaker 1: Miche you appreciate it very much, and good luck with

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Speaker 1: your forecast Westpac. Seeing your economist Michael Gordon with us

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Speaker 1: ten minutes past seven. For more from the mic Hosking

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Speaker 1: Breakfast listen live to News Talks at B from six

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