ECONOMIC INDICATORS – AUSTRALIA

Jobs growth makes for murky reading in census aftermath

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Original article by Philip Baker
The Australian Financial Review – Page: 30 : 19-Aug-16

New data from the Australian Bureau of Statistics shows that the economy added 71,600 part-time jobs in July 2016, although it shed 45,000 full-time positions. Currency traders responded positively to the net gain of more than 26,000 jobs, with the Australian dollar peaking at $US0.7720 in local trading on 18 August. However, Kate Hicks of Capital Economics notes that some of the jobs would have been temporary ones associated with the census.

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AUSTRALIAN BUREAU OF STATISTICS, CAPITAL ECONOMICS LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD

Wages growth stuck at record low of 2.1pc

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Original article by Ewin Hannan
The Australian Financial Review – Page: 3 : 18-Aug-16

The Wage Price Index for the June 2016 quarter indicates that wages growth has stagnated at 2.1 per cent for the past 12 months. Figures released by the Australian Bureau of Statistics on 17 August 2016 show that wages in the private sector increased by 1.9 per cent over the period, while the public sector recorded wages growth of 2.3 per cent.

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AUSTRALIAN BUREAU OF STATISTICS, ACTU, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Australian real unemployment jumps to 10.5% (up 0.9%) in July during post-election uncertainty

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

A Roy Morgan Research survey on Australia’s labour market has found that the real unemployment rate rose by 0.9 per cent to 10.5 per cent in July 2016. Some 1.365 million Australians (up 268,000 since July 2015) are now unemployed. Meanwhile, the number of people in the workforce has risen to 13,007,000 (up 334,000 since July 2015), and 11,642,000 Australians are employed (up 66,000 in the last 12 months). The number of people who are under-employed has risen by 194,000 in the last 12 months to 1,171,000 (9.0 per cent of the workforce). The official unemployment rate was 5.8 per cent in June 2016.

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ROY MORGAN RESEARCH LIMITED, AUSTRALIAN BUREAU OF STATISTICS

ANZ-Roy Morgan Australian Consumer Confidence bounces back – up 2.9pts to 117.6

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 17-Aug-16

ANZ-Roy Morgan Australian Consumer Confidence has risen by 2.5 per cent to 117.6 in the week ending 15 August 2016, largely offsetting the decline over the previous week. Sentiment is now 4.3 per cent above its long-run average. The improvement in confidence was driven by a sharp rebound in consumers’ views of the economic outlook. Households’ views of the economic outlook in the next 12 months rose by 9.6 per cent, while consumers’ views of their future finances rose by 1.7 per cent.

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ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA

NAB forecasts more cuts in interest rates

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Original article by Jacob Greber
The Australian Financial Review – Page: 4 : 10-Aug-16

National Australia Bank expects the Reserve Bank to reduce the cash rate by another 50 basis points in the next 12 months, to a record low of one per cent. The banking major anticipates rate cuts in both May and August 2017. Meanwhile, NAB’s latest monthly survey shows that both business sentiment and business conditions declined in July 2016. Likewise, the ANZ Bank-Roy Morgan consumer sentiment index fell by 2.8 per cent in the first week of August.

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NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, ROY MORGAN RESEARCH LIMITED

Gary Morgan’s comment on this week’s Consumer Confidence & Business Confidence – both down

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 10-Aug-16

This week’s fall in ANZ-Roy Morgan Consumer Confidence – down 3.3pts to 114.7 – follows a similar fall in Roy Morgan Business Confidence during July – down 3.4pts to 116.1. Both falls come as the new Turnbull Government deals with a closer than expected Federal Election result and a record 11 Senate cross-benchers. Although that might at first appear to be a huge problem for the Turnbull Government, the fact that most of the new cross-benchers in the Senate are right-of-centre should make dealing with the Senate easier during this term of Parliament than it was during the last term and it should be possible for the Government to pass its reforms with corporate tax cuts and the Australian Building & Construction Commission (ABCC) to increase workplace productivity. The RBA’s decision to cut interest rates to a record low 1.25% last week is a step in the right direction to stimulate the broader Australian economy; however, a further cut of 1% at the RBA’s next meeting is required to be competitive with international competitors including the US & UK and deal with the rising $A and slowing Australian economy after the end of the mining boom.

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ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA, AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSION

ANZ-Roy Morgan Australian Consumer Confidence takes a hit – down 3.3pts to 114.7

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 10-Aug-16

ANZ-Roy Morgan Australian Consumer Confidence has fallen by 2.8 per cent to 114.7 in the week ending 7 August 2016. This is a surprising result given that the RBA cut the cash rate to a historic low of 1.5 per cent last Tuesday. While the drop is disappointing, overall confidence remains well above its long run average. The deterioration in confidence was relatively broadly based. Consumers’ views of their current finances fell by 2.4 per cent, and households’ views of the economic outlook in the next 12 months fell by 8.5 per cent.

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ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA

Cutting rates to get the $A lower brings risks to the economy

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Original article by Philip Baker
The Australian Financial Review – Page: 28 : 10-Aug-16

The Australian dollar has risen above $US0.76 since the Reserve Bank reduced the cash rate to a record low of 1.5 per cent on 2 August 2016. The currency has benefited from the fact that the local cash rate is still quite high relative to many countries, so further money policy easing may be necessary in order to put sustained downward pressure on the dollar. However, this strategy has economic risks, such as the potential to undermine consumer confidence. Indeed, the ANZ/Roy Morgan consumer confidence rating fell by 2.8 per cent to 114.7 in the first week of August.

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RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, ROY MORGAN RESEARCH LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, TD SECURITIES, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF JAPAN, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

ANZ-Roy Morgan Australian Consumer Confidence picks up steam ahead of the RBA meeting – up 2.5pts to 118.0

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

ANZ-Roy Morgan Australian Consumer Confidence has risen by 2.2 per cent to 118.0 in the week ending 31 July 2016, with the improvement in confidence being broadly based. Increasing speculation of a rate cut at this week’s RBA meeting was likely a key driver of confidence. In addition, the buoyancy of the equity market – with the Australian share market recording its best July in six years – was also key in supporting household sentiment. Consumers’ views of their current finances rose by 6.8 per cent, and households’ views of the economic outlook in the next 12 months rose by 3.7 per cent.

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

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

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