Tasmania has taken home the trophy, for the eighth time in a row, for the best performing Aussie economy.
Commonwealth Bank’s State of the States report ranks each state and territory economy on eight key indicators to conclude which is the best.
“The aim is to find how each economy is performing compared with ‘normal’. And just like the Reserve Bank does with interest rates, we used decade-averages to judge the ‘normal’ state of affairs,” CBA chief economist Craig James said.
“For each economy, the latest level of the indicator – such as retail spending or economic growth – was compared with the decade average.”
The eight indicators are:
Construction work done
Dwelling commencements (building new homes)
How do the states compare?
Here is the official ranking for this quarter:
New South Wales
Australian Capital Territory
“It is important to note at the outset that all states and territories are performing well in challenging and ever-changing times,” James said.
“Governments have the primary aim of protecting the health of Australians while providing substantial stimulus and support measures to protect economies.”
James said Tasmania holds the mantle because it has ranked first of four of the eight indicators and is second ranked on another two.
“Tasmania is ranked first on relative unemployment, retail spending, equipment investment and dwelling starts,” he said.
“Tasmania also ranks second on construction work done and relative economic growth.”
Of the other economies, James said, there is little to separate them as each have done a good job of navigating the challenging times due to COVID.
“In a fast-evolving environment dominated by the COVID-19 virus, rankings of relative economic
performance can change, even on a monthly basis,” he said.
“In an absolute sense, Australia’s state and territory economies are in solid shape, well supported by strong fiscal and monetary stimulus.”
Omicron hits states hard
Separately, new data showed that while Australians had intended to spend big heading into 2022, there are already signs that those expectations won't be met due to the impact of Omicron.
CBA's household spending intentions index rose 2.5 per cent in December, its highest level since the survey began in July 2017.
However, CBA senior economist Belinda Allen said despite the rise in intentions to spend the data is showing that Aussies aren’t following through.
"We can see from our high frequency credit and debit card data there does appear to be a fall in spending in January, with spending on services more impacted than goods spending," she said.
- With AAP