AUSTRALIA – ECONOMIC CONDITIONS

Handouts row: Take a hike, says Reserve

roymorgansocial Leave a comment

Original article by Matthew Cranston, Thomas Henry
The Australian – Page: 1 & 5 : 6-May-26

Treasurer Jim Chalmers says the Reserve Bank of Australia’s decision to increase the cash rate to 4.35 per cent yesterday will add to the pressure that families and businesses are already facing. He adds that the federal governments intends to play a helpful rather than harmful role in the fight against inflation. However, RBA governor Michele Bullock has cautioned against giving households more money in next week’s budget, arguing that this would make it harder for the central bank to bring inflation under control. AMP’s chief economist Shane Oliver says the government should reduce public spending in the budget to help alleviate underlying inflation pressures, while also introducing reforms aimed at boosting productivity and capacity in the economy.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA, AMP LIMITED – ASX AMP

RBA cautious on any further rate cuts

roymorgansocial Leave a comment

Original article by Luke Kinsella
The Australian Financial Review – Page: 8 : 19-Nov-25

The minutes of the Reserve Bank’s monetary policy board meeting for November outline the circumstances under which it would consider further interest rate cuts. The minutes indicate that the RBA would only consider a rate cut if there is a material deterioration in the labour market or if households become more cautious about spending. The monetary policy board noted that inflationary pressures would be weaker under both scenarios, making interest rate cuts more likely. However, the RBA expects both the unemployment rate and economic growth to remain steady over the next several years.

CORPORATES
RESERVE BANK OF AUSTRALIA

Job losses not RBA’s priority as bank keeps rates on hold

roymorgansocial Leave a comment

Original article by Shane Wright, Millie Muroi
The Age – Page: Online : 2-Apr-25

Reserve Bank of Ausralia governor Michele Bullock says that keeping inflation under control will be its top priority, after the central bank’s new monetary policy board left the cash rate unchanged on Tuesday. Bullock contends that there is no point in letting inflation rise because it would eventually result in higher unemployment. The RBA’s monetary policy statement noted that although underlying inflation is continuing to ease, the board needs to be confident that inflation will return to the middle of its target range of 2-3 per cent and stay there. Shadow treasurer Angus Taylor says the RBA’s interest rates decision affirms the fact that living standards have declined since Labor took office in 2022.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN LABOR PARTY

Inflation pain for households will linger well beyond 2026

roymorgansocial Leave a comment

Original article by Simon Benson
The Australian – Page: 5 : 27-Nov-24

Analysis of the Reserve Bank’s forecasts in its statement on monetary policy for November suggests that real household income per capita will rise by 1.3 per cent in the current quarter, followed by growth of 1.2 per cent in 2025 and 1.1 per cent in 2026. However, Australians’ living standards are still set to be 4.4 per cent lower at the end of 2026 than at the time of the May 2022 federal election; this is despite the central bank factoring in a fall in the cash rate from 4.35 per cent at present to 3.5 per cent over the next two years. Shadow treasurer Angus Taylor said Australians are paying the price for Labor’s economic mismanagement, and they will continue to live with the damage of the inflation crisis well into the late 2020s.

CORPORATES
RESERVE BANK OF AUSTRALIA, LIBERAL PARTY OF AUSTRALIA

Treasurer’s panic and disloyalty

roymorgansocial Leave a comment

Original article by Dennis Shanahan, Jack Quail
The Australian – Page: 1 & 4 : 4-Sep-24

Former prime minister John Howard has criticised Treasurer Jim Chalmers for attempting to blame the Reserve Bank of Australia for the nation’s high interest rates. He contends that this has badly backfired, and RBA governor Michele Bullock does not deserve to be attacked in this way. Howard has also defended the performance of Bullock and the RBA’s board, arguing that they have had no alternative to raising the cash rate, due to factors such as the level of inflation and government spending. However, former RBA governor Bernie Fraser says the central bank has lost credibility and needs to reduce the cash rate sooner rather than later.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA

Economy on track for soft landing: Chalmers

roymorgansocial Leave a comment

Original article by Patrick Commins, Geoff Chambers
The Australian – Page: 4 : 12-Jun-24

Treasurer Jim Chalmers will use a speech on Wednesday to defend the federal government’s high-spending 14 May budget. He will contend that it would be irresponsible for the government to cut its expenditure too deeply in the current environment of flat economic growth and high interest rates. He will also state that Labor’s "more balanced approach" will bring inflation under control without "crunching the economy". Chalmers will in turn state that the government is "cautiously confident" that the economy will experience a ‘soft landing’.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY

Sharp drop in profit growth amid anaemic household spending

roymorgansocial Leave a comment

Original article by Michael Read
The Australian Financial Review – Page: 4 : 5-Jun-24

Data from the Australian Bureau of Statistics shows that earnings outside the resource sector have risen by just 1.6 per cent over the last year. A downturn in consumer spending amid the cost-of-living crisis was the key contributor to the decline in earnings growth. However, lower coal and iron ore exports also weighed on earnings in the resources sector. KPMG’s chief economist Brendan Rynne says the figures show that the nation is "a heartbeat away from a recession". The quarterly national accounts data to be released today will provide more evidence regarding the state of the economy.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, KPMG AUSTRALIA PTY LTD

Economy, rates in a holding pattern

roymorgansocial Leave a comment

Original article by Eli Greenblat
The Australian – Page: 15 : 23-Apr-24

Deloitte Access Economics has claimed that the Australian economy is in a "holding pattern", while it does not expect the Reserve Bank to move on interest rates until November. Deloitte states that inflation is beginning to recede, while it expects around 100,000 people will lose their jobs by the end of the year, lifting the unemployment rate to 4.6 per cent. It notes that the revamped stage three tax cuts will take effect in the second half of the year, boosting disposable income, but that the housing crisis remains a concern.

CORPORATES
DELOITTE ACCESS ECONOMICS PTY LTD, RESERVE BANK OF AUSTRALIA

Households coping well, says Bullock

roymorgansocial Leave a comment

Original article by Michael Read
The Australian Financial Review – Page: 1 & 6 : 29-Nov-23

Reserve Bank of Australia governor Michele Bullock addressed an international conference in Hong Kong on Tuesday. She told the audience – which included a number of central bankers – that Australian households and businesses are in a "pretty good position", despite the "political noise" regarding the RBA’s 13 interest rate increases since May 2022. Bullock also conceded that the RBA’s goal of returning inflation to its target range of 2-3 per cent by the end of 2025 is "very uncertain". Her predecessor Philip Lowe told the conference that he is concerned that central banks may not yet have lifted interest rates far enough to rein in inflation.

CORPORATES
RESERVE BANK OF AUSTRALIA

Lowe: we are on way to taming inflation

roymorgansocial Leave a comment

Original article by Patrick Commins
The Australian – Page: 1 & 4 : 2-Aug-23

Treasurer Jim Chalmers says the Reserve Bank of Australia’s decision to leave the cash rate unchanged at 4.1 per cent on Tuesday will be a "welcome reprieve" for people who are "doing it tough". He adds that while inflation is falling, it is still too high. RBA governor Philip Lowe has also acknowledged that consumer price growth remains too high, but says the recent data is consistent with inflation returning to the target range of 2-3 per cent over time. Lowe adds that a second successive pause will give the RBA more time to assess the impact of the rate rises to date, as well as the economic outlook.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA