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ANZ Says Strong Household Spending Poses Risk to Slowdown View Ahead of RBA Meeting

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ANZ said the second quarter household spending outcome suggests a 0.5% to 0.6% quarter-on-quarter increase in household consumption in the second quarter national accounts, beating the bank's estimate and presenting some risk to its view of a pronounced slowdown in consumer demand, according to a Tuesday note by the bank.

The bank said household spending rose 0.7% quarter-on-quarter in volume terms in the second quarter, following an upwardly revised 0.8% lift in the first quarter, with the slowdown in household spending volumes gradual and quarterly volume growth easing only modestly over the past three quarters.

ANZ said it maintains its view that the Reserve Bank of Australia will keep the cash rate unchanged at 4.35% at its meeting in the coming week, with a small risk of a rate hike in November remaining, but this risk is not part of its base case.

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