ECONOMIC INDICATORS – AUSTRALIA

Inflation data set to drift further from RBA target

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Original article by Patrick Commins
The Australian Financial Review – Page: 21 : 29-Jul-19

The consensus of economists polled by Bloomberg is that Australia’s underlying inflation rate eased from 1.6 per cent to 1.5 per cent in the June quarter. The CPI data to be released by the Australian Bureau of Statistics on 31 July is likely to heighten expectations that the Reserve Bank will further ease monetary policy by October, while it might also boost the local sharemarket.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, RESERVE BANK OF AUSTRALIA, AMP CAPITAL INVESTORS LIMITED, STANDARD AND POOR’S ASX 200 INDEX

Health insurance exodus continues at alarming rate

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Original article by James Fernyhough
The Australian Financial Review – Page: 20 : 26-Jul-19

The percentage of Australians aged between 20 and 28 with private health insurance cover for hospitals fell by 6.9 per cent in 2018, according to data from the Australian Prudential Regulation Authority. The overall percentage of Australians with hospital cover at the end of 2018 was 44.6 per cent, the lowest level since December 2006. The latest data follow a recent report from the Grattan Institute which claimed that the private health insurance sector is in a "death spiral" because of the continued decline of people with cover.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, GRATTAN INSTITUTE, NIB HOLDINGS LIMITED – ASX NHF, MEDIBANK PRIVATE LIMITED – ASX MPL

Energy policy, IR changes urgent

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Original article by Richard Ferguson
The Australian – Page: 7 : 26-Jul-19

Australian Industry Group CEO Innes Willox has backed comments by top bureaucrat Martin Parkinson on the nation’s declining productivity rate. Willox says that uncertainty regarding energy and carbon emissions policy has contributed to Australia’s underperformance in terms of productivity growth, and he has urged action on these issues. Australian Chamber of Commerce & Industry CEO James Pearson has in turn stressed the need for industrial relations reforms in order to lift productivity. Parkinson will shortly retire as the head of the Department of the Prime Minister & Cabinet.

CORPORATES
THE AUSTRALIAN INDUSTRY GROUP, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, BUSINESS COUNCIL OF AUSTRALIA, AUSTRALIAN LABOR PARTY, ACTU

Top bureaucrat’s warning on threat to living standards

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Original article by Simon Benson
The Australian – Page: 1 & 4 : 25-Jul-19

The Department of Prime Minister & Cabinet’s outgoing secretary Martin Parkinson says Australia’s productivity growth has fallen below global standards. He warns that growth in Australia’s living standards will decline over the next decade unless action is taken to boost productivity. Parkinson adds that political instability and policy uncertainty may have contributed to the fall in productivity over the last decade.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA

ANZ-Roy Morgan Consumer Confidence up to 116.3

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Original article by Roy Morgan
Market Research Update – Page: Online : 24-Jul-19

ANZ-Roy Morgan Australian Consumer Confidence rose 0.3% to 116.3 in the week ended 21 July. The financial and economic conditions subcomponents were positive, implying the detail was better than the headline suggested. Households’ views towards current financial conditions rose 2.8%, while views towards future financial conditions were up 0.3%; both indices are comfortably above their respective long-term average. Consumers’ views toward current economic conditions rose 3.4% and views toward future economic conditions rose 1%. The ‘time to buy a household item’ index was the only subindex that fell, dropping 4.4%. The four-week moving average for inflation expectations was flat at 4.0%, though weekly inflation expectations rose for the third consecutive week.

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

RBA to look past weak GDP in June quarter

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Original article by John Kehoe
The Australian Financial Review – Page: 7 : 23-Jul-19

Economists expect that annualised GDP growth will be less than that recorded in the March quarter when figures for the June quarter are released. IFM Investors’ chief economist Alex Joiner says the expected weak result could explain why the Reserve Bank of Australia decided to cut interest rates in June and July. The RBA and the federal government are expected to look at other economic data in preference to the June GDP figures when deciding whether further monetary or fiscal stimulus is needed.

CORPORATES
IFM INVESTORS PTY LTD, RESERVE BANK OF AUSTRALIA

Job data puts rate cut expectations on hold

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Original article by David Rogers
The Australian – Page: 27 : 19-Jul-19

The chances of an interest rate cut in August have lengthened following the release of data showing that Australia’s official unemployment rate was steady at 5.2 per cent in June. Analysis by Westpac suggests that financial markets are pricing in a 15 per cent chance of a rate cut in August, although the Reserve Bank is still widely tipped to ease monetary policy by the end of the year. The jobless rate rose from 5.19 per cent to 5.24 per cent in unrounded terms in June, while the underemployment rate fell to 8.2 per cent.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, AMP CAPITAL INVESTORS LIMITED

More of us endure extended pay freeze

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Original article by Ewin Hannan, Greg Brown
The Australian – Page: 2 : 17-Jul-19

The Reserve Bank of Australia’s analysis of wage price index data shows that the size of wage increases and the frequency of pay rises has declined since 2013. The RBA’s Natasha Cassidy notes that there has also been a significant increase in the proportion of workers who have been subject to a wage freeze of at least 12 months. Meanwhile, ACTU secretary Sally McManus has criticised the Treasury over research which suggested that the reluctance of workers to change jobs has contributed to low wages growth.

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

RBA flags another rate cut if jobs market deteriorates

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Original article by David Rogers
The Australian – Page: 2 : 17-Jul-19

The Reserve Bank of Australia indicated in the minutes of its monthly board meeting that there is likely to be spare capacity in the labour market for some time, while jobs growth is likely to ‘moderate’. Labour market data for June will be released on 18 July, and the official unemployment rate is expected to be steady at 5.2 per cent. The employment and inflation outlook is likely to influence the timing of further interest rate cuts; some economists say the RBA may wait to gauge the impact of the cuts in June and July before further easing monetary policy.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, UBS HOLDINGS PTY LTD

ANZ-Roy Morgan Consumer Confidence moderates to 115.9

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Original article by Roy Morgan
Market Research Update – Page: Online : 17-Jul-19

ANZ-Roy Morgan Australian Consumer Confidence fell 1.5% to 115.9 in the week ended 14 July, following a decline of 1.1% in the previous week. Households’ views towards current financial conditions fell 2.7%, while views towards future financial conditions fell 1.5%; this compares to up-ticks of 3.7% and 1.3% respectively for the previous week. Consumers’ views toward current economic conditions fell 1% and views toward future economic conditions fell 2.6%, after falls of 3.6% and 1.7% respectively in the previous week. The ‘time to buy a household item’ index was unchanged, and the four-week moving average for inflation expectations was flat at 4%.

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