Australia Westpac leading index rose to -2.56 in August, up from -4.42. Westpac said the improvement was broadly consistent with 1.8% growth in Q3, despite an expected -4% in the coronavirus center Victoria. That would also mean a “somewhat” moderated growth pace in Q4 at 2.2%. The combined second half growth would be 4%, more optimistic that RBA’s expectation of 1.3%.

Westpac also noted some market speculation surfaced after RBA minutes, for a rate cut from 0.25% to 0.1%. Such an option will “remain under considering but there appears to be no urgency”. RBA would indeed focus on supporting government bond markets first, including borrowing of state and territory governments.

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