Thoughts from Nomura;..........>

AUSTRALIA DATA REACT: Thoughts from Nomura; Slightly weaker than expected Q3 GDP

print, with the economy growing by 0.6% (mkt 0.7%). The lift in the annual rate

to 2.8% (from 1.8%) reflects the negative print from last year rolling out of

the calculations. Business investment was the main positive contributor in the

quarter, with the other sectors subdued or detracting from growth. Today's data

was broadly in-line with the RBA's forecasts. These types of outturns should

keep the subdued inflation backdrop in place, and reinforces our expectations

that the RBA is in no hurry to raise rates.

The mix of the RBA lagging other major central banks and bias for Australia's

terms of trade to ease lower (as illustrated by the turn down in base metal

prices over recent sessions as a focus on deleveraging in China grows, and still

rising supply in some markets such as iron ore comes through) supports our

expectation for the Aussie to remain a relative underperformer over the coming

months.