The WA economy is on track for a solid end to the year, according to the latest Westpac CCI Leading Index of WA Economic Activity.
The state’s economy is on track for a solid end to the year, according to the latest Westpac CCI Leading Index of WA Economic Activity.
The index posted 0.6 per cent growth in August.
Helping the index post a fourth consecutive month of growth, steel production in China was the biggest contributor in August, which increased by 1.3 per cent.
Other indicators contributing to growth were building approvals, which rose for the 14th straight month in August, and new lending which grew by 2 per cent.
"The ongoing growth of the index shows that the fundamentals of the economy still remain sound," CCI chief economist John Nicolaou said.
"With 2014 shaping up to be a more positive year for the global economy and record population growth continuing, this will see exports and housing investment play a greater role in driving activity in the coming year and beyond."
However, not all areas of the index experienced growth in August, with retail sales taking 0.06 per cent off the index and softer labour market conditions contributing to an extra 0.01 percentage point fall.
"Falling confidence still remains the biggest risk to the state's continued economic growth path as businesses and consumers continue to assess their spending intentions," Mr Nicolaou said.
"Both state and federal government have a role to play in restoring confidence by setting out a reform agenda that will improve and reduce the cost of doing business."
The index, which is the first of its kind in the state, provides insight into the performance of the local economy. By combining and analysing seven economic variables, the index can predict cyclical turning points in the Western Australian economy.