ECONOMIC FORECASTING

Budget gets Trump bump

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Original article by Jacob Greber, Tom McIlroy, David Marin-Guzman
The Australian Financial Review – Page: 1 & 4 : 24-Jan-18

The Australian Government’s May 2018 Budget may take into account the impact of the Trump administration’s tax reforms when restating its forecasts for global economic growth. The mid-year update in December maintained Treasury’s current forecast of global economic growth of 3.5 per cent in 2018. However, Treasury may respond to the International Monetary Fund’s upgrade of its global growth forecasts by upwardly revising its own guidance.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, INTERNATIONAL MONETARY FUND, THE AUSTRALIAN INDUSTRY GROUP, HSBC AUSTRALIA HOLDINGS PTY LTD, UNIVERSITY OF SYDNEY. UNITED STATES STUDIES CENTRE, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, RESMED INCORPORATED – ASX RMD

Trump tax cuts lift world economy

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Original article by Ben Packham
The Australian – Page: 1 & 2 : 23-Jan-18

The International Monetary Fund forecasts that the global economy will grow by 3.9 per cent in 2018 and at a similar pace in 2019. The global economy grew by 3.7 per cent in 2017. The IMF has also used its latest world economic outlook report to upgrade its forecast for US economic growth in 2018 by 0.4 per cent, to 2.7 per cent, citing the likely impact of the Trump administration’s company tax reforms. Treasurer Scott Morrison says the IMF’s forecasts emphasise the need for Australia’s company tax rate to be reduced to ensure that the nation remains internationally competitive.

CORPORATES
INTERNATIONAL MONETARY FUND, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, WESTPAC BANKING CORPORATION – ASX WBC, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH

OECD predicts best growth in six years

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Original article by Geoff Winestock
The Australian Financial Review – Page: 3 : 21-Sep-17

The OECD has upgraded its forecast for global economic growth in 2018 by 0.1 per cent, to 3.7 per cent. However, Australia’s economic growth outlook remains unchanged, although the OECD noted the nation’s high housing prices. The Reserve Bank’s assistant governor, Luci Ellis, is also upbeat about the global economic outlook, noting that global growth should continue for some time in the absence of any major risk factors. Meanwhile, the ANZ Bank anticipates two increases in the cash rate during 2018.

CORPORATES
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT, RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIAN BUSINESS ECONOMISTS INCORPORATED

Protectionism hurts growth: BHP

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Original article by Peter Ker
The Australian Financial Review – Page: 3 : 28-Apr-17

BHP Billiton’s Huw McKay says global economic growth in 2017 is likely to be at the higher end of the group’s recent forecast of between three and 3.5 per cent. However, he warns that global growth is likely to slow over the rest of the current decade as some nations adopt protectionist policies. McKay adds that this will in turn affect global demand for resource commodities. BHP’s Vicky Binns says factors such as a looming increase in iron ore supply and lower demand for steel in China are likely to weigh on the iron ore price in coming months.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, VALE SA, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

G20 growth target ends in failure

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Original article by David Uren
The Australian – Page: 1 & 4 : 25-Jul-16

The Group of 20 finance ministers have reiterated their commitment to a global economic growth target. This is despite new projections showing that the two per cent growth target for 2018 set at the G20 summit in Brisbane in 2014 is unlikely to be achieved. Australian Treasurer Scott Morrison and his predecessor Joe Hockey say this growth target is still relevant. Adam Triggs of the Australian National University says the latest forecasts from the International Monetary Fund suggest that the global economy will be worth $US117.7trn by 2018, rather than the target of $US123.9trn set in 2014.

CORPORATES
GROUP OF TWENTY (G-20), AUSTRALIA. DEPT OF THE TREASURY, INTERNATIONAL MONETARY FUND, AUSTRALIAN NATIONAL UNIVERSITY, AUSTRALIA. DEPT OF HUMAN SERVICES. MEDICARE AUSTRALIA, SUPREME COURT OF THE UNITED STATES

Brexit forces IMF to clip growth outlook

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Original article by Jacob Greber
The Australian Financial Review – Page: 1 & 11 : 20-Jul-16

The International Monetary Fund has scaled back its forecast for global economic growth in 2016 from 3.1 per cent to three per cent. The global economy is now forecast to expand by 3.4 per cent in 2017, compared with previous expectations of 3.5 per cent growth. The UK’s vote to leave the European Union contributed to the decision to downgrade the growth forecasts, while the IMF adds that a range of geopolitical risks could also affect global growth.

CORPORATES
INTERNATIONAL MONETARY FUND, RESERVE BANK OF AUSTRALIA

RBA keeps open door for August interest rate cut

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Original article by Jacob Greber
The Australian Financial Review – Page: 3 : 20-Jul-16

The minutes of the Reserve Bank of Australia’s monthly board meeting show that inflation data for the June 2016 quarter will be a key factor in its monetary policy decision in August. The central bank’s board expects the inflation rate to remain below its target range of 2-3 per cent in the near-term. Meanwhile, board members anticipate that the UK’s exit from the European Union will have a "modest adverse effect" on global economic growth, but they noted that it is too soon to assess the extent of the impact.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Recession in Europe a ‘very scary’ prospect

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Original article by Vesna Poljak, James Chessell, James Thomson
The Australian Financial Review – Page: 15 & 20 : 27-Jun-16

Opinion is divided regarding the likely impact of the UK’s vote to leave the European Union. Financial markets were sold down in the wake of the "Brexit" referendum, and Wilson Asset Management chairman Geoff Wilson warns of the potential for another financial crisis. However, Randal Jenneke of T Rowe Price does not expect Brexit to lead to an economic crisis, arguing that it is a political issue and a political crisis. Meanwhile, Investors Mutual’s Anton Tagliaferro says Brexit will have no impact on the majority of Australian-listed companies.

CORPORATES
WILSON ASSET MANAGEMENT, T ROWE PRICE GROUP INCORPORATED, INVESTORS MUTUAL LIMITED, FTSE 100 INDEX, METAGE CAPITAL GLOBAL VALUE FUND, UNICREDIT SPA, BANCO POPOLARE, BANK OF IRELAND PLC, GREAT BRITAIN. OFFICE OF THE PRIME MINISTER, EUROPEAN COMMISSION

RBA warning on Brexit

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Original article by Phillip Coorey, James Chessell
The Australian Financial Review – Page: 1 & 4 : 24-Jun-16

Prime Minister Malcolm Turnbull says there will be a global economic shock if the UK votes to leave the European Union, adding that the Coalition is best-placed to manage the Australian economy during such turmoil. Meanwhile, both major political parties have been briefed by the heads of the Reserve Bank, the Australian Prudential Regulation Authority and the Treasury on the likely impact of a "Brexit" on the local financial market. The outcome of the referendum is tipped to be very close.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, RESERVE BANK OF AUSTRALIA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA. DEPT OF THE TREASURY, GREAT BRITAIN. OFFICE OF THE PRIME MINISTER, EUROPEAN COMMISSION, STANDARD AND POOR’S ASX 200 INDEX, AUSTRALIAN LABOR PARTY, LIBERAL PARTY OF AUSTRALIA, NATIONAL PARTY OF AUSTRALIA

Goldman upbeat, we won’t get a recession

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Original article by Vanessa Desloires
The Australian Financial Review – Page: 32 : 10-Feb-16

Modelling by investment bank Goldman Sachs suggests that there is a 25 per cent chance that developed economies will experience a recession in the next 12 months. This compares with the historical average of 28 per cent. The risk of Australia experiencing a recession is just 13 per cent, while the long-term average is 23 per cent. Goldman Sachs chief economist Jan Hatzius argues that the recent volatility in global financial markets presents an opportunity for risk-averse investors.

CORPORATES
THE GOLDMAN SACHS GROUP INCORPORATED, TAILORED INVESTMENT SOLUTIONS PTY LTD, RESERVE BANK OF AUSTRALIA, MONTGOMERY INVESTMENT MANAGEMENT PTY LTD, WILSON ASSET MANAGEMENT