Australia's population growth surge following the reopening of international borders is now unwinding faster than previously indicated, reaching an annual rate of 1.8% in Q3 2024 and is now assumed to be 1.7% for calendar year 2024 by both Westpac and the RBA. This slowdown is expected to **reduce demand pressure on the housing market** and implies that **rent inflation should slow further**.

* There is currently a **high degree of uncertainty** in the global economic outlook, particularly surrounding bilateral trade negotiations and tariffs, which is impacting central banks.

* The US economy is seen as "solid" with "solid" labour market conditions, but inflation is "somewhat elevated" with "significant uncertainties" stemming from trade and migration policies. The **FOMC is in a 'wait and see' mode**.

* In New Zealand, the **RBNZ cut its official cash rate (OCR) by 25bps to 3.25%**, a decision made by a 5-1 vote. They **downgraded their economic forecasts** for 2025 GDP growth to 1.8%yr (from 2.4%) due to the weaker global outlook from increased trade protectionism.

* Despite the rate cut and downgraded forecasts, the RBNZ showed caution regarding the timing and extent of future cuts, noting "no bias" for the July meeting and that future decisions will be data-dependent. Westpac's New Zealand economists now expect the next RBNZ rate cut in August rather than July.

* In Australia, the April Monthly CPI Indicator showed headline inflation at 2.4%yr, while the **monthly trimmed mean ticked up to 2.8%yr, posing some upside risk to Westpac's Q2 CPI forecast**.

* Australia's **Q1 GDP growth is forecast to slow to 0.4%qtr (1.5%yr)**, partly impacted by natural disasters and a slight decline in private CAPEX, though external demand brought forward ahead of tariff increases may provide some offset. Net exports are expected to add 0.4ppt to Q1 GDP growth.

* Household spending in Australia looks like another soft month in April due to holiday disruptions and weak vehicle sales.