K62 Finance

Gary Morgan on Consumer Confidence and the RBA’s decision to drop Australian interest rates to 1.5%

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Original article by Gary Morgan, Roy Morgan Research
Market Research Update – Page: Online : 3-Aug-16

The August interest rate cut by the RBA shows that finally the RBA has acknowledged Australia’s massive under-employment problem that has been persistently ignored (8.3% – 1.079 million, in June, according to the latest Roy Morgan employment estimates). In addition, it’s time policymakers recognised the true extent of unemployment in Australia (9.6% in June – 1.247 million – according to the latest Roy Morgan real unemployment estimate). To provide an effective stimulus to the economy the RBA should immediately cut Australian interest rates to 0.5% – the same as in the comparable economies of the US & UK and as we have been calling for the RBA to do for more than two years. Reducing interest rates will have the most positive impact on the Australian economy when the banks start lending to more businesses rather than just households – particularly as this week’s ANZ-Roy Morgan Consumer Confidence shows Australians are growing increasingly confident – now at 118.0 (up 2.5pts this week). By providing increased finance and credit to businesses the Australian economy will grow strongly and more jobs will be created for the over 2 million Australians either unemployed or under-employed

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Westpac aims for 20pc Asian managers

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Original article by Misa Han
The Australian Financial Review – Page: 5 : 29-Jul-16

Westpac CEO Brian Hartzer wants the bank to have greater diversity among its staff. The bank aims to raise the ratio of its executives with an Asian background from 13 per cent to 20 per cent. Hartzer says it is primarily a business issue, although social justice is also important to him. Race discrimination commissioner Tim Soutphommasane suggests that businesses should aim for 10 per cent of their senior executives to have a non-European background.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

ANZ says credit card late fees won’t rise after court win

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Original article by James Eyers
The Australian Financial Review – Page: 2 : 28-Jul-16

Andrew Watson of law firm Maurice Blackburn has warned that banks may increase their credit card late payment fees after the High Court dismissed a class action case. Watson says the Federal Government should step in to protect consumers from unfair fee increases, but the ANZ Bank says such intervention is unnecessary as the court has ruled that its fees are fair. The bank has also ruled out increasing its late payment fees, which it had reduced in 2009. The class action commenced in 2010.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, MAURICE BLACKBURN PTY LTD, HIGH COURT OF AUSTRALIA, IMF BENTHAM LIMITED – ASX IMF, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, UNIVERSITY OF NEW SOUTH WALES

ANZ-Roy Morgan Australian Consumer Confidence ticks up to 115.5 (up 0.6pts)

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 27-Jul-16

ANZ-Roy Morgan Australian Consumer Confidence has risen by 0.5 per cent to 115.5 in the week ending 24 July 2016. Lower financial market volatility and buoyant equity markets are likely the main factors behind the improvement. Consumers’ views of their current finances fell two per cent, but households’ views of the economic outlook in the next 12 months rose by 1.5 per cent.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

ANZ-Roy Morgan Australian Consumer Confidence edges lower to 114.9 (down 0.3pts)

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 20-Jul-16

ANZ-Roy Morgan Australian Consumer Confidence has fallen for the fourth week in a row, down 0.3 per cent to 114.9 in the week ending 17 July 2016. The headline index is now 3.3 per cent lower than four weeks ago. Consumers’ views of their current finances edged 0.2 per cent higher last week, while consumers’ views of the economic outlook in the next 12 months rose by 3.1 per cent.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

ANZ-Roy Morgan New Zealand Consumer Confidence slips to 118.2 in July (down 0.7pts)

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 18-Jul-16

The ANZ-Roy Morgan New Zealand Consumer Confidence Index has fallen from 118.9 to 118.2 in July 2016. However, it is holding in at levels of elevation, and in line with its historical average. In seasonally adjusted terms confidence rose from 118 to 119, the second monthly rise in a row. The Current Conditions and Future Conditions indices were both down by a small amount, but they were up marginally in seasonally adjusted terms.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Only extreme event will trigger RBA QE

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Original article by Mark Mulligan
The Australian Financial Review – Page: 3 : 18-Jul-16

Perpetual Investment’s Matt Sherwood says geopolitical tensions would not be a sufficient reason for the Reserve Bank of Australia to implement quantitative easing. He argues that such measures would only be necessary if there were a major crisis such as the collapse of the Chinese economy. The RBA has developed a strategy for implementing quantitative easing, and Sherwood says this demonstrates that the central bank wants to be more prepared than it was at the onset of the global financial crisis in 2008.

CORPORATES
RESERVE BANK OF AUSTRALIA, PERPETUAL INVESTMENTS, UNITED STATES-CHINA JOINT COMMISSION ON COMMERCE AND TRADE, BT INVESTMENT MANAGEMENT LIMITED – ASX BTT

Moody’s issues bleak outlook for banks

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 19 : 15-Jul-16

Australian banks are likely to experience pressure on their profit margins because of low interest rates. Frank Mirenzi of Moody’s states in a report released on 14 July 2016 that household debt has increased as a result of rising house prices and low income growth. At present, the big four banks have an "Aa2" rating from Moody’s and an "AA-" rating from Standard & Poor’s.

CORPORATES
MOODY’S INVESTORS SERVICE INCORPORATED, STANDARD AND POOR’S CORPORATION, RESERVE BANK OF AUSTRALIA, HSBC BANK PLC, WELLS FARGO AND COMPANY, BNY MELLON ASSET MANAGEMENT AUSTRALIA LIMITED

Super-size me: NAB banks on giant new fund

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Original article by Michael Bennet
The Australian – Page: 23 : 14-Jul-16

National Australia Bank’s MLC Super Fund has become the nation’s second-largest superannuation fund and the biggest retail fund after five separate funds were amalgamated. The enlarged MLC Super boasts some $A70bn worth of funds under management, and NAB has indicated that rationalising its super funds is likely to result in lower fees for members. The consolidation of its super funds will also enable NAB to separate its super and investment businesses from its life insurance arm, in which a controlling stake has been sold to Nippon Life.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED, NIPPON LIFE INSURANCE COMPANY LIMITED, AUSTRALIANSUPER PTY LTD

ANZ-Roy Morgan Australian Consumer Confidence falls further – down 0.6pts to 115.2

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 13-Jul-16

ANZ-Roy Morgan Australian Consumer Confidence has fallen for the third week in a row, down 0.5 per cent to 115.2 in the week ending 10 July 2016. Uncertainty related to the election result and lingering concerns over the global outlook likely remain key factors behind the recent decline. Last week’s downgrade from Standard & Poor’s to the outlook for Australia’s credit rating – from stable to negative – could also have weighed on sentiment. Consumers’ views of their current finances edged 0.3 per cent higher, but households’ views of the economic outlook in the next 12 months fell by 4.1 per cent.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ