Barclays write "given today's weaker......>

AUSTRALIA: Barclays write "given today's weaker than expected growth print, we

revise our 2019 growth forecast lower to 2.3% (2.5% previously), with risks

balanced. The monetary policy implications of today's weak GDP could be

significant. First, the economy has entered a per capita recession after almost

13 years (H1 2006), albeit the decline is relatively shallow, and not close to

the shocks seen in Q3 16 or Q1 11 or during the GFC. Second, the RBA has a

relatively optimistic view of the domestic labour market, which now seems

somewhat out of sync with the latest economic data. We think any change in

labour market direction would a significant cause of concern for the central

bank. As such, we suggest watching the labour market data very closely in the

next three months, and if the unemployment rate starts to rise towards 5.3-5.5%

(5% currently), we think the RBA may consider cutting policy rates by 25-50bp in

H2 2019. However, our base case remains for the RBA to stay on hold in 2019."