ECONOMIC INDICATORS – AUSTRALIA

Apartment slowdown a risk to wider industry

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Original article by Michael Bleby
The Australian Financial Review – Page: 39 : 8-Aug-18

Australia’s Performance of Construction Index recorded overall growth of 1.4 points to 52.0 in July, marking the sector’s 18th consecutive month of growth. However, the sub-index for attached housing declined by 11.7 points to 36.7, and Peter Burn of the Australian Industry Group says the downturn in activity in the apartment sector could have implications for the broader construction industry if it is sustained.

CORPORATES
THE AUSTRALIAN INDUSTRY GROUP, HOUSING INDUSTRY ASSOCIATION LIMITED

ANZ-Roy Morgan Consumer Confidence drops back to 118.9

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Original article by Roy Morgan
Market Research Update – Page: Online : 8-Aug-18

ANZ-Roy Morgan Australian Consumer Confidence fell 0.8% to 118.9 in the week ended 5 August, entirely reversing the previous week’s gain. Consumers’ views towards current financial conditions rose 0.5%, on the back of a 2.9% increase in the previous week, but sentiment around future financial conditions fell 1.3%. Consumers’ assessment of current economic conditions declined 2.7%, partially unwinding the 4.1% gain in the previous week. Meanwhile, views towards future economic conditions were up 1.4%, following a 0.3% rise in the previous week. The "time to buy a household item" subindex fell 1.7% to its lowest point in 16 weeks.

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

July Business Confidence down for third straight month to 113.6

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Original article by Roy Morgan
Market Research Update – Page: Online : 6-Aug-18

In Australia, Business Confidence fell 0.8pts (-0.7%) to 113.6 in July 2018, according to the latest Roy Morgan Business Single Source survey. Business Confidence has dropped below its level of a year ago for the first time in 2018 and is now 3.4pts lower than in July 2017, and 2.7pts below its long-term average of 116.3. However, despite falling for three consecutive months following the Federal Budget, Business Confidence throughout the first seven months of 2018 has averaged 117.5 – above the long-term average and the highest yearly average since 2014. Businesses remain largely positive, with 50.9% (up 4.4ppts) saying now is a "good time to invest in growing the business" and 50.5% (up 0.2ppts) expecting "good times" for the Australian economy over the next five years. Roy Morgan CEO Michele Levine says that towards the end of July there was some good news for businesses, which traditionally prefer certainty rather than uncertainty. The victories for Labor at the "Super Saturday" by-elections removed the temptation for Prime Minister Malcolm Turnbull to call an early election later this year. Turnbull has since confirmed that he plans on calling the next Federal Election in May 2019 and has re-affirmed the Government’s pledge to legislate further business tax cuts when Parliament resumes.

CORPORATES
ROY MORGAN LIMITED, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET

Inflation keeps RBA’s hands tied

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Original article by Patrick Commins, Vesna Poljak
The Australian Financial Review – Page: 1 & 6 : 26-Jul-18

Alex Joiner of IFM Investors says the latest inflation data is "underwhelming". Official figures show that consumer price inflation rose by a below-forecast 0.4 per cent in the June quarter and by 2.1 per cent in the year to June. The underlying inflation rate fell below the lower end of the Reserve Bank’s target range of 2-3 per cent. Justin Smirk of Westpac notes that inflation data has now been below consensus forecasts for a record seventh successive quarter.

CORPORATES
IFM INVESTORS PTY LTD, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, JP MORGAN AUSTRALIA LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Slowdown in east coast housing gathers speed

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Original article by Michael Bleby
The Australian Financial Review – Page: 33 : 26-Jul-18

Data from Domain Holdings shows that Australia’s median house price fell by one per cent to $802,077 in the June 2018 quarter. The median house price in Sydney eased 1.4 per cent in the quarter, to $1,144,217, with the median unit price down 0.5 per cent quarter-on-quarter. Sydney’s median house price was 4.5 per cent lower in the year to June, with the median unit price down 3.5 per cent. Meanwhile, the median house price in Melbourne fell by 1.8 per cent quarter-on-quarter, although it rose 0.5 per cent year-on-year.

CORPORATES
DOMAIN HOLDINGS AUSTRALIA LIMITED – ASX DHA, CORELOGIC AUSTRALIA PTY LTD, FAIRFAX MEDIA LIMITED – ASX FXJ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, NEW SOUTH WALES. DEPT OF PREMIER AND CABINET

Petrol prices to drive inflation higher

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Original article by Patrick Commins
The Australian Financial Review – Page: 3 : 25-Jul-18

The median forecast of economists polled by Bloomberg is for consumer price inflation of 0.5 per cent in the June quarter, compared with 0.4 per cent in the March quarter. Australia’s consumer price inflation is forecast to have risen to 2.2 per cent in the year to June, up from 1.9 per cent previously. A sharp rise in the price of petrol in the June quarter is tipped to have been a major contributor to the rise in the inflation rate. Economists do not expect the latest inflation data to have a material impact on the outlook for official interest rates.

CORPORATES
BLOOMBERG LP, AUSTRALIAN BUREAU OF STATISTICS, RESERVE BANK OF AUSTRALIA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, SOCIETE GENERALE AUSTRALIA LIMITED, MORGAN STANLEY AUSTRALIA LIMITED, JP MORGAN AUSTRALIA LIMITED

ANZ-Roy Morgan Consumer Confidence down to 118.9

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Original article by Roy Morgan
Market Research Update – Page: Online : 25-Jul-18

ANZ-Roy Morgan Australian Consumer Confidence fell 2.1% to 118.9 in the week ended 22 July, to its lowest value in seven weeks. Households’ views towards current financial conditions fell 1.9%, more than reversing the 1.5% bounce in the previous week. Similarly, households were also less optimistic about future financial conditions, which fell 1.4%. Consumers’ assessment of current economic conditions weakened by 3.8%, more than unwinding the cumulative 2.8% rise of the previous two weeks. Views towards future economic conditions declined 3.9% to 112.7. Both subindices are at their lowest points in seven weeks. The "time to buy a household item" subindex was flat (-0.1%), holding on to its 2.4% gain in the previous week.

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

Tough times for builders: housing starts to fall 22pc

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Original article by Michael Bleby
The Australian Financial Review – Page: 32 : 23-Jul-18

The Housing Industry Association had forecast in February that housing starts will decline to 174,880 in 2020. BIS Oxford Economics in turn has predicted that housing starts will fall from 2018’s estimated figure of 219,000 to 171,350 in 2020, equating to a 22 per cent fall. The forecast decline in housing starts is expected to be led by a significant downturn in the construction of high-density dwellings. There have been a number of building company failures in recent months, the latest being home renovator Dowling Homes.

CORPORATES
HOUSING INDUSTRY ASSOCIATION LIMITED, BIS OXFORD ECONOMICS PTY LTD, DOWLING HOMES, BRI FERRIER PTY LTD, BAYSIDE CONSTRUCT, PROJECT GROUP, WATERSUN HOMES

Home buyers falling behind in repayments

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Original article by Michael Roddan
The Australian – Page: 21 : 20-Jul-18

The Northern Territory had the highest percentage of mortgage borrowers who were in arrears among all Australian states and territories in May 2018, according to Standard & Poor’s. Victoria and Western Australia recorded a decline in borrowers who were in arrears, while New South Wales and Queensland recorded an increase. Overall, the number of Australian borrowers falling behind on their mortgage repayments increased by two basis points to 1.38 per cent in May.

CORPORATES
STANDARD AND POOR’S (AUSTRALIA) PTY LTD, RESERVE BANK OF AUSTRALIA

Jobs boom raises stakes for RBA

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Original article by Jacob Greber
The Australian Financial Review – Page: 1 & 4 : 20-Jul-18

Official data shows that Australia’s unemployment rate was steady at 5.4 per cent in June, with the economy adding a higher-than-expected 50,900 jobs. This comprised 41,200 full-time and 9,700 part-time jobs. The data prompted a rebound in the Australian dollar on 19 July, while it may put pressure on the Reserve Bank to move more quickly to tighten monetary policy. The trend jobless rate was last at its current level in November 2012, when the cash rate was 3.25 per cent, compared with 1.5 per cent at present.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN BUREAU OF STATISTICS, GOLDMAN SACHS AUSTRALIA PTY LTD, TD SECURITIES, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, UNITED STATES. FEDERAL RESERVE BOARD