Domain: House price growth continues to slow

ScreenHunter_07 Mar. 20 20.55 By Leith van Onselen Domain Group (previously known as Australian Property Monitors) has released its December quarter house and unit price results (below), which recorded a 2.1% increase in house prices over the quarter at the national capital city level, and a 1.7% rise in national capital city unit prices. In the year to December 2014, APM recorded an 7.1% increase in national capital city house prices and a 6.0% rise in unit values - a deceleration from the 9.4% (houses) and 6.8% (units) annual growth reported in the September quarter release. Looking at the capital city breakdown, you can...
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QLD politicians’ $91 million property holdings

ScreenHunter_5775 Jan. 29 06.41 By Paul Egan, Philip Soos & Lindsay David Introduction Following our analysis of Federal and Victorian Parliamentarians’ real estate holdings, attention turns to Queensland, where Premier Campbell Newman has called a snap early election for 31st January, 2015. Australia, including Queensland, is facing a chronic housing affordability crisis. Housing price inflation has outstripped both rents and household incomes since 1996, leading to a residential property market that is unaffordable by both historic and international comparison. Queensland’s elected representatives, like their...
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Polls quack for Dead Duck Tony

sda A couple of polls late yesterday painted a bleak picture for Dead Duck Tony: And from Roy Morgan: ALP support rose to 56.5% (up 2%) on Australia Day weekend, well ahead of the L-NP 43.5% (down 2%) on a two-party preferred basis.  If a Federal Election were held now the ALP would win easily according to this week’s Morgan Poll on voting intention conducted with an Australia-wide cross-section of 2,057 Australian electors aged 18+. Primary support for the ALP rose to 39.5% (up 1%) now ahead of the L-NP 37.5% (down 1%). Support for the other parties shows The Greens at 12% (up 2.5%),...
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RBA rate hawks screech into abyss

images It's been a while since the hawkish minded have had a moment. But yesterday's CPI gave them the brief platform they needed to re-screech their case. From COMMSEC, via Bloomie: “Australia is far different from some other parts of the globe,” said Savanth Sebastian, an economist at a unit of Commonwealth Bank of Australia. “The euro zone continues to worry about the deflationary threat from sluggish growth and sliding oil prices, while inflation remains below the Fed’s target rate in the U.S. But here in Australia inflation is holding at the low end of the Reserve Bank’s...
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Australian bonds give rate hawks the bird

2 So far the bond market is concerned, RBA rate cuts got more likely overnight not less. It's been a wild ride for bond over the past 24 hours as the knee jerk reaction to yesterday's CPI gave bears a moments in the sun, only for clouds to quickly close over and a renewed deluge of buying drove yields to new record lows. Here's the chart: Yes, the 2 year bond is now pricing two full cuts, asap, with yields at record lows. Most of the damage occurred before the RBNZ doved-up and the icing was ladled on after. And the curve flattening continued with the 2/5 year slope closing to as little as...
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RBNZ doves hammer Aussie dollar

imgres The RBNZ is never caught on the hop, from Westpac: The RBNZ’s OCR Review this morning kept the OCR unchanged at 3.50% as expected, but shifted from an explicit tightening bias to an explicit neutral bias with an allowance for rate cuts – a dovish market surprise. The most important change, from the market’s point of view, was a rewording of the policy outlook paragraph, which is the final one in the press release. The sentence “Some further increase in the OCR is expected to be required at a later stage.” was dropped, and effectively replaced by “In the current circumstances, we expect...
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Chep Index shows slowing retail

1 From Deloitte: The sixteenth edition of the AFGC CHEP Retail Index indicates that a slowdown will be seen in year-on-year growth in retail sales. The Index was 4.5 per cent higher in December 2014 compared to December 2013, a slightly higher rate of growth from 4.2 per cent in September 2014. On a quarterly basis, the Index was 4.4 per cent higher in the December quarter 2014 compared to the December quarter 2013. Growth in the Index is expected to slow over the first few months of 2015, to 2.5 per cent over the 12 months to February 2015 and 2.4 per cent over the 12 months to the March...
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Daily iron ore price update (Anglorious)

anvil Here are the iron ore charts for January 28, 2015: Some better news in paper markets with Dalian six month futures rebounding yesterday afternoon, though in chart terms it has now established a near perfect bearish descending triangle pattern that I still expect will break. The 12 month swap continues to explore new lows. As does spot, with benchmark also down .10 to $62.70. Rebar leads on into the pit and so long as it does, iron will be dragged along. The news of the day comes from Anglo American via the WSJ: Anglo American PLC is set to write down the value of some of its biggest...
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Will China de-peg from the US dollar?

China-slowdown From BNPP’s Richard Iley via FTAlphaville: Asia ex-Japan is inevitably caught in the increasingly dangerous cross fire of these currency wars. In essence, there are two pernicious dynamics at play. First, those economies with USD pegs – de facto (China) or de jure (Hong Kong) are inevitably directly importing the stronger USD and so are accordingly seeing a dramatic loss of competitiveness vs. the EUR and the JPY. Secondly, with the world likely to remain awash of liquidity for the next 12-18 months, the inevitable normalisation of still permissive global financial conditions is likely to remain...
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Fed finesses rate hikes

imgres Here is last night's FOMC statement: Information received since the Federal Open Market Committee met in December suggests that economic activity has been expanding at a solid pace. Labor market conditions have improved further, with strong job gains and a lower unemployment rate. On balance, a range of labor market indicators suggests that underutilization of labor resources continues to diminish. Household spending is rising moderately; recent declines in energy prices have boosted household purchasing power. Business fixed investment is advancing, while the recovery in the housing sector remains...
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Links January 29, 2015

ScreenHunter_01 Apr. 02 06.19 Global Macro / Markets / Investing:  Saudi Aramco to renegotiate some contracts on low oil price - CEO – Reuters China commodity trade data show winners are scarce – Reuters Sadly for all our futures, cheap money is here to stay. Just get used to it - Telegraph Anglo American boosts iron ore output but warns of impairment – Telegraph Banking inquiry: Unruly bankers should be punished in meaningful way  - Irish Independent We need true popular capitalism to bust the cartels – Telegraph….that is precisely what we need… Does It Help or Hinder? Central Banks Split on Oil...
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ASX at the close

ScreenHunter_31 Jun. 04 16.42 Stan Shamu for Chris Weston, Chief Market Strategist at IG Markets Cracks appear in US earnings The impact of global growth is slowly starting to be reflected in corporate earnings with an underwhelming reporting session in the US setting the tone for global markets. Apart from Apple which smashed estimates, the majority of reporting companies missed expectations. Key economic bellwethers such as Caterpillar and Microsoft disappointed with the stronger US dollar playing a role. Caterpillar is experiencing weaker demand from energy companies as oil and other commodities prices plunge and a...
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Australia to export flawed PPPs to the world?

ScreenHunter_06 Jun. 06 09.33 Cross-posted from The Conversation: While in Davos representing Australia at the World Economic Forum, Assistant Treasurer Josh Frydenberg has enthusiastically extolled the virtues of the Global Infrastructure Hub as a way of funding an infrastructure shortfall, particularly in developed nations. Frydenberg told the ABC: “There is a great deal of interest here at Davos in what Australia is doing because essentially this infrastructure hub is a knowledge sharing platform. It is about sharing best practice across the funding of infrastructure, the construction of infrastructure and the...
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China consumer confidence sinks

1 From Westpac: Four of the five components that go into the calculation of the Westpac MNI China CSI declined from the previous month. Current family finances, business conditions ‘one year ahead’ and ‘five years ahead’, and ‘time to buy a major household item’ all moved lower. Family finances ‘one year ahead’increased strongly though, presumably jointly reflecting the lower inflation and interest rate expectations reported elsewhere in the survey. Current business conditions (not a part of the headline composite, but tightly correlated with official industrial production...
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Abbott installs knighthoods filter on self

12905332-car-engine-air-filter-3d-render From The Australian: A REPENTANT Tony Abbott has conceded he derailed Campbell Newman’s re-election campaign by appointing Prince Philip a knight of Australia, vowing “considerably more consultation” on future appointments. ...Mr Abbott said he took the decision after consulting with Governor-General Sir Peter Cosgrove and Order of Australia Council chairman Sir Angus Houston. “I stand by the decision. I understand why some people don’t like it. I respect their right to be critical; that’s what you get in a democracy such as ours and I take it on the chin,” he said. Consultation...
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NSW gas prices to crash. What?

image-20150127-17557-1i95iyh Cross-posted from The Conversation. Gas developers have been ominously warning of impending gas shortages in New South Wales, with official forecasts from planning authorities pointing to steady or rising demand. Yet our analysis suggests that these forecasts are likely well off the mark, that gas demand in NSW will fall, and that in reality NSW is facing an inevitable price shock, not a gas shortage. With prices rising, consumers who reduce gas use and switch to alternatives might well weather the storm best, and that could mean a big drop in the demand for gas. Our analysis suggests that gas...
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Rental growth at decade low

ScreenHunter_07 Jul. 17 21.09 By Leith van Onselen The December quarter consumer price index (CPI) data, released today by the Australian Bureau of Statistics (ABS), revealed continued moderate rental growth at the national capital city level. According to the ABS, rents nationally grew by 0.5% over the December quarter of 2014 – the lowest quarterly growth since March 2005 – and was up by only 2.4% in the 2014 calendar year, with a clear downwards trend evident (see below charts). What's most interesting about the current moderate rental growth is that it is at odds with other housing-related indicators, such...
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Idiotic equity action as iron ore sinks

2 Whoa! Sometimes it really is fun watching equity mis-pricing in action. Today the major iron ore miners are up (or were) as iron ore is clearing its throat for a drop into the $50s. Go figure! FMG is demonstrating greater sanity, falling 4% back to $2. Here are the indexes: The FMG sanity spread is at its widest to date but the two majors have turned bonkers once more: ,  And the lunacy has spread to juniors today with most up. Not that it matters, death has settled on the couch and is waiting patiently for the day traders to give up their little bit of fun: Dalian is down another...
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Odey: Oz at centre of looming global crash

url From Crispin Odey, the $12 billion hedge fund manager, and his latest newsletter: The themes I have been outlining since the second quarter of 2014 are now establishing themselves: A faltering Chinese economy with growth ultimately slowing down to 3%. A hard landing for those countries plugged into China’s growth - especially Australia, South Africa and Brazil. A fall in commodity prices bringing with it pain to those heavily exposed. For oil this is the Middle East, Venezuela, Argentina, mid-west USA, Canada, Norway and Scotland. No one forecast how fast and how far those commodity markets...
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Rupert demands Peta Credlin resign

best-job-search-advice-youre-fired The drama intensifies around Dead Duck Tony: Firing squad...
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CPI in detail: Inflation well checked

ScreenHunter_01 Jun. 08 23.33 By Leith van Onselen As noted briefly by Houses & Holes, the Australian Bureau of Statistics (ABS) has released the Consumer Price Index (CPI) data for the December quarter 0f 2014, which registered a modest quarterly increase in headline inflation, but with underlying inflation rising well ahead of expectations (although well contained in annual terms). According to the ABS, headline CPI rose by a modest 0.2% in the December quarter, which follows September's 0.5% rise (see next chart). On an annual basis, headline CPI growth fell to 1.7% from 2.3% in the September quarter, which is...
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CPI comes in high

CPI_logo The Australian Bureau of Statistics (ABS) has released the Consumer Price Index for the December quarter and it was soft at 0.2% on the quarter and 1.7% on the year in the headline figures but the analytical series were well ahead of forecast at 0.7% versus 0.5% expected: DECEMBER KEY FIGURES Sep Qtr 2014 to Dec Qtr 2014 Dec Qtr 2013 to Dec Qtr 2014 Weighted average of eight capital cities % change % change All groups CPI 0.2 1.7 Food and non-alcoholic beverages 0.1 2.0 Alcohol and tobacco 1.7 7.4 Clothing and...
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Coalition to compromise on university funding

ScreenHunter_26 Oct. 16 10.41 By Leith van Onselen The Australian is reporting today that the Abbott Government will compromise on its university reform package in a bid to gain passage through the hostile Senate. The Government has reportedly flagged that it will abandon its proposed 20% cut to university funding provided the Senate allows universities to set their own course fees - a move that would likely blow another $2 billion hole in the Budget. The compromise is designed to gain the support of South Australian senator Nick Xenophon and Palmer United Party senators Zhenya Wang and Glenn Lazarus, who voted against the...
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DEEWR job vacancies fade

2 The DEEWR job vacancy report for December is out and fell 0.9% on the month: The trend measures are rolling over after a very poor recovery:   Weakness was focused in NSW, WA and the ACT: Skilled positions were weak:   A fairly dour...
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Leading index slips

1 From Westpac: The six month annualised deviation from trend growth rate of the Westpac Melbourne Institute Leading Index which indicates the likely pace of economic growth three to nine months into the future declined from –0.49% in November to –0.61% in December. The Leading Index has now registered below trend growth in eleven of the last twelve months. Official figures show GDP growth recorded a lacklustre 2.5% pace in the first nine months of2014. Based on the Leading Index, the Australian economy looks set to continue recording below trend growth well into 2015. The Leading...
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