Chinese trade pullback could cost $25bn

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Original article by David Rogers
The Australian – Page: 17 & 27 : 22-Aug-19

Andrew Boak of Goldman Sachs warns that the fallout from the US-China trade war could eventually hit Australia. He says growing tensions between Australia and China could potentially result in a sharp fall in Chinese demand for key Australian exports, including education and commodities such as iron ore and coal. Goldman Sachs suggests that in a worst-case scenario, lower Chinese demand could reduce Australia’s GDP growth rate by 130 basis points in 2020.

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GOLDMAN SACHS AUSTRALIA PTY LTD, HUAWEI TECHNOLOGIES COMPANY LIMITED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG

Fixed rate falling to new lows under 3pc

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Original article by Cliona O’Dowd
The Australian – Page: 21 : 22-Aug-19

Australia’s residential property market has received a boost in the lead-up to the key selling season, with a number of banks reducing their fixed mortgage interest rates to new lows. Greater Bank has slashed its one-year fixed rate to just 2.79 per cent, while some owner-occupier loans offered by St George and the Bank of Melbourne have been reduced to 2.94 per cent. Sally Tindall of RateCity cautions that fixed home loan interest rates may fall even lower, given that the Reserve Bank may further reduce the cash rate.

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GREATER BANK LIMITED, ST GEORGE BANK LIMITED, BANK OF MELBOURNE LIMITED, BANK OF SOUTH AUSTRALIA LIMITED, RATECITY PTY LTD, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, CANSTAR PTY LTD

PM commits warship, planes to Gulf mission

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Original article by Geoff Chambers, Simon Benson, Ben Packham
The Australian – Page: 1 & 2 : 22-Aug-19

The federal government will join a US-led coalition that aims to protect oil tankers when passing through the Strait of Hormuz. The national security committee approved Australia’s participation on 19 August; the nation’s contribution to the coalition will include a frigate, a surveillance aircraft and 187 personnel. Prime Minister Scott Morrison has stressed the need to safeguard the nation’s oil supplies and to protect global sea lanes. He notes that 30 per cent of Australia’s refined oil passes through the Strait of Hormuz.

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AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN DEFENCE FORCE, UNITED STATES. DEPT OF STATE, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, GROUP OF SEVEN (G-7), AUSTRALIAN LABOR PARTY

Where’s the crisis? Westpac skewers talk of quantitative easing

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Original article by Patrick Commins
The Australian Financial Review – Page: 29 : 22-Aug-19

Lyn Cobley, the head of institutional banking at Westpac, says unconventional monetary policy was necessary in response to the global financial crisis. However, she says there is no need for the Reserve Bank to pursue quantitative easing at present, as the Australian economy and the nation’s banking system are "far from crisis". She adds that Westpac’s senior institutional bankers generally agree that further reducing interest rates would have little impact on the borrowing and investment intentions of their clients.

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WESTPAC BANKING CORPORATION – ASX WBC, RESERVE BANK OF AUSTRALIA, EUROPEAN CENTRAL BANK, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Claims of underquoting an odd sign of a market rising

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Original article by Su-Lin Tan, Nila Sweeney
The Australian Financial Review – Page: 34 : 22-Aug-19

Some buyers’ advocates have expressed concern that the residential property market is again being affected by underquoting. Melbourne-based Scott Hall notes that there has been a significant decline in underquoting by real estate agents since legislation to crack down on the practice was introduced in 2017. Real Estate Institute of New South Wales CEO Tim McKibbin agrees that underquoting has become less prevalent in recent years.

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THE REAL ESTATE INSTITUTE OF NEW SOUTH WALES, FAIR TRADING NSW, VICTORIA. DEPT OF JUSTICE AND REGULATION. CONSUMER AND BUSINESS AFFAIRS VICTORIA, RAINE AND HORNE PTY LTD

Dramatic fall in enterprise agreement delays

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Original article by David Marin-Guzman
The Australian Financial Review – Page: 6 : 21-Aug-19

Data from the Fair Work Commission shows that it took an average of 35 days to approve enterprise bargaining agreements in the last six months, and an average of just 30 days in the 2018-19 financial year. The FWC has previously attracted criticism from the Australian Mines & Metals Association, which claimed that the average time it takes to approve an EBA had blown out to 76 days. AMMA CEO Steve Knott says delays in approving EBAs are being exacerbated by the way the FWC applies the ‘better-off-overall test’.

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AUSTRALIA. FAIR WORK COMMISSION, AUSTRALIAN MINES AND METALS ASSOCIATION (INCORPORATED), AUSTRALIA. DEPT OF EMPLOYMENT, SKILLS, SMALL AND FAMILY BUSINESS

Australians should get used to US-China trade war as superpowers tussle for supremacy

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Original article by
News.com.au – Page: Online : 21-Aug-19

Prime Minister Scott Morrison has warned that the trade war between the US and China may continue for some, while noting that the ongoing trade tensions could create opportunities for Australia. Morrison has also told the Seven Network that due to its economic success, China must abide by the same rules as other nations. Morrison will shortly attend the Group of Seven leaders’ summit in France.

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AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, GROUP OF SEVEN (G-7)

Government flags heavy-handed crackdown on black economy

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Original article by Mike Bruce
The New Daily – Page: Online : 21-Aug-19

Gary Pflugrath of CPA Australia says the federal government should reconsider proposed legislation to restrict cash payments between businesses and individuals to no more than $10,000. It was one of the recommendations of the government’s Black Economy Taskforce, but Pflugrath contends that there are sufficient "checks and balances" to counter criminal activity. Kurt Wallace from the Institute of Public Affairs says restricting cash payments would have little impact on the cash economy, while reducing the freedoms of ordinary Australians. Individuals could face big fines and imprisonment for breaching the proposed laws.

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CPA AUSTRALIA, INSTITUTE OF PUBLIC AFFAIRS LIMITED, H&R BLOCK LIMITED, ONE NATION PARTY, UNIVERSITY OF MELBOURNE

Push to include family home in pension test

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Original article by Michael Roddan
The Australian – Page: 4 : 21-Aug-19

The Actuaries Institute has published a discussion paper which examines a range of options for overhauling Australia’s retirement income system. The authors argue amongst other things that the federal government should consider measures such as including the family home in the pension assets test, the abolition part-pensions and the introduction of death duties. The paper also warns that Australia’s ageing population will put the federal Budget under growing pressure unless action is taken. The report was written by David Knox, Anthony Asher and Michael Rice.

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ACTUARIES INSTITUTE, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. PRODUCTIVITY COMMISSION, GRATTAN INSTITUTE

Climate failures cost us: ALP poll review

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Original article by Troy Bramston
The Australian – Page: 1 & 4 : 21-Aug-19

A submission to Labor’s review of its 2019 federal election campaign has contended that lack of sufficient detail of the party’s climate change policy contributed to its surprise defeat on 18 May. The Labor Environment ­Action Network’s submission notes that the Opposition’s climate change action plan did not outline how much it would cost, how it would be funded or what economic benefits it would have. LEAN members also argue that Labor’s franking credits policy and its stance on Adani’s Carmichael coal mine also contributed to its election loss.

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AUSTRALIAN LABOR PARTY, ADANI MINING PTY LTD