Wednesday will see the ABS release its December building approvals figures, and BetaShares chief economist David Bassanese has said a small uptick won't change the market's downward momentum.
"After a 12.7% slump in November for building approvals, markets will be looking if the indicator bounces back," Bassanese said. “Although a modest bounce back of, say, 3% to 4% is a reasonable expectation, that would still imply that the downwards trend –evident since early 2015– remains firmly in place, undercutting an important source of economic growth for 2016."
But Bassanese said some good news may be on the horizon. The ABS will release its December retail sales figures on Friday, which are expected to show consumer spending remained reasonably firm over the Christmas period.
“Weaker petrol prices and solid employment growth are positives for consumer spending, while soft wages growth and signs of a topping out in house prices are emerging negative forces. Heightened share market volatility is a further risk for consumer spending during the month of January."
The chief economist of a leading ETF provider has said a small bounce in building approvals won't convince the market.