FX.co ★ Australia Leading Index Stable in June

The Westpac–Melbourne Institute Leading Economic Index was unchanged in June 2026, following a revised 0.1% decline in May, with the underlying measure showing signs of stabilisation after most of the earlier weakness occurred in the first quarter of the year. However, the six‑month annualised growth rate slipped to -0.36% from -0.25% in May, its sixth consecutive below‑trend reading and the weakest pace since late 2023. This points to a deceleration in economic momentum, reflecting the lagged impact of the RBA’s interest rate increases in February, March, and May, as well as earlier fuel price shocks tied to geopolitical tensions. A narrowing yield spread was the biggest drag on the index, with softer dwelling approvals, consumer expectations, and hours worked also contributing to the decline. Looking ahead, renewed inflation pressures and ongoing tensions in the Middle East pose additional downside risks to growth. The RBA’s attention will now turn to the June quarter CPI report ahead of its August policy meeting.