Gross operating profits and wages both grew by a modest 0.8 percent during the fourth quarter of last year, while home building and job ads slumped in yet more signs that the economy is losing traction ahead of the official GDP report and the central bank’s policy meeting this week.

The latest data for profits and wages published by the Bureau of Statistics appear relatively positive on paper as they continue to track higher, but Westpac’s Andrew Hanlan said they were only in line with their own lower end forecast of 0.2% GDP growth for the December quarter, which would put annual growth at 2.4%.

Citi’s analysts noted that the uptick for wages in Q4 was largely consistent with the number of hours worked and that overall, the data was weak considering the greater number of people that have entered work during the last twelve months. However, they said that it was not a disastrous showing.

Other figures released by the ABS showed approvals to build new homes were down 2.5% in February compared to the previous month and 29% lower year-over-year. The sharp fall combined with weak data elsewhere prompted ANZ’s Felicity Emmett to speculate that Australia’s economy may have contracted in Q4 2018. The official report for the fourth quarter will be released on Wednesday.

The majority of analysts expect GDP to have grown by a relatively pedestrian 0.4% during the period, with many citing a drop in consumption due to a weakness in wages and the ongoing fall in house prices. The lower forecast is also pressuring annual growth, which The Reserve Bank of Australia still expects to hit 3% this year, but actually appears to be slowing to around 2.6%.

The central bank will convene this week for its monthly policy meeting where many of the trending topics, including a slump in home prices, are sure to be high on the agenda. The marked decline, which has extended beyond Sydney and Melbourne to wider Australia, could crimp household and spending, and may force the bank to intervene and cut interest rates.

Westpac economist Matthew Hassan said the latest data on homes is ‘clearly still very weak’ but offered some solace by stating that the weakness for non high-rise activity prevalent during the final months of last year is now less evident. However, he said dwelling construction ‘will continue to detract from growth’ during the remainder of 2019.

The new figures from ABS also highlighted a disparity in fortunes for enterprises depending on the industries they operate in. Mining profits, for example, saw a healthy 4% rise on a seasonally adjusted basis, while wages in the sector also rose as companies benefited from higher commodity prices.

In contrast, manufacturing saw profits enter negative territory with a 3.6% decline and wage payments fall 0.8%, while media and telecoms, and rental and real estate, experienced similar drop offs in both areas. However, the worst performer by some margin was financial and insurance services, where earnings were 26.6% lower in Q4.

Cautious consumers are making it more difficult for enterprises to drive sales, revenue and profits, while also having the knock-on effect of making businesses less likely to increase the salaries of current employees. Gross profits and wages only rose 0.8% in Q4 but, more worryingly, job ads have plummeted.

ANZ head of Australian economics, David Plank noted: ‘The labor market has been a key source of strength for the Australian economy over the past year, with the strong gain in jobs and declining unemployment rate providing a material offset to the impact of lower house prices. The year ahead looks to be more challenging.’