Australian Economy


It’s time for a debate on private health insurance

Cross-posted from The Conversation: ­ The six previous papers in this series highlight the poorly defined role private health insurance plays in the funding and delivery of Australian health care, and how the Abbott government might allow this role to expand. But major changes to Australia’s iconic Medicare system should not happen by stealth. They


Falling AUD saves the Aussie tourism industry

By Leith van Onselen The Australian Bureau of Statistics (ABS) has released trade data for the month of February, with Australia recording a seasonally-adjusted trade deficit of $1,256 million. The result just beat analyst’s expectations, who had expected a trade deficit of only $1.3 billion. It was the eleventh monthly trade deficit in a row


Job vacancies follow the bubble

By Leith van Onselen The Australian Bureau of Statistics (ABS) has released job vacancies data for the February quarter, which recorded a 0.7% seasonally adjusted increase over the quarter, and a 1.2% rise in trend terms: Over the year, job vacancies rose by 6.2% seasonally adjusted and by 6.3% in trend terms. Changes in vacancies


CBA demands government fix confidence

It’s still early in the bust but jeez it’s already getting perverse. From Dad’s Army: The Commonwealth Bank has launched a fresh call for the federal government to develop a long-term plan to tackle the major economic threat posed by sagging confidence levels. Australia’s biggest lender says volatility in the global economy, and in particular


The great Australian bust is upon us

Don’t kid yourself, the iron ore crash is the end of the great Australia boom and the beginning of the great Australian bust. Australia’s terms of trade are being put to the sword and worse is ahead. Iron ore will be at $30 by year end and the two coals will fall in sympathy though much


Falling commodity prices to crush national income

By Leith van Onselen The RBA has released its commodity price index for March, which registered another 1.7% fall in SDR (currency weighted) terms – the key determinant of the terms-of-trade – and a 2.8% fall in Australian dollar terms: Preliminary estimates for March indicate that the index declined by 1.7 per cent (on a


Engineering construction levitates above mining cliff

By Leith van Onselen The ABS has released engineering construction data for the December quarter of 2014, which revealed a 0.6% seasonally adjusted fall in the value of work done over the quarter, a 12.4% fall over the year, and an ongoing reduction in the construction pipeline. According to the ABS, private sector engineering construction


Lateline hammers TPP trade sell-out

By Leith van Onselen Last night, ABC’s Lateline dedicated an entire program to the Trans-Pacific Partnership (TPP) – the US-led trade deal being negotiated between 12 Pacific Rim nations, including Australia. The first segment showed how interests within the US political system – particularly the Democratic Party and unions – are opposed to the TPP,


Competition review targets pharmacies, taxis, planning

By Leith van Onselen The final report of the Harper competition policy review has been released and urges the government to free-up rules preventing competition in the the pharmacy and taxi industries, as well as in the delivery of urban land supply. On pharmacies, the report recommends dumping pharmacy location and ownership rules: The current


Manufacturing PMI booms!

April fool! The manufacturing recession rolls endlessly on and really is the butt of all jokes: The Australian Industry Group Australian Performance of Manufacturing Index (Australian PMI®) moved up by 0.9 points to 46.3 points in March (seasonally adjusted). This indicated a fourth consecutive month of contraction in activity (readings below 50 points indicate contraction) across the manufacturing sector


Melbourne: Lord of the population ponzi

By Leith van Onselen The Australian Bureau of Statistics (ABS) yesterday released its Regional Population report for the 2013-14 financial year, which revealed that Melbourne remains king of the population ponzi, adding a whopping 95,700 people (an MCG’s worth) to its population in 2013-14, representing growth of 2.2%: The highest rate of growth, however, was


Australian household debt ratios hit record

By Leith van Onselen The Reserve Bank of Australia (RBA) today updated its quarterly financial statistics, which revealed that Australian household debt rose to an all-time high in the December quarter of 2014. The ratio of mortgage debt-to-disposable income hit a record 140.3% in December, up from June 2010 peak of 134.7% (see next chart).


Consumer confidence stuck at low altitude

By Leith van Onselen The ANZ-Roy Morgan Research (RMR) consumer confidence index has risen slightly once again, rising 0.9 points to 112.3 in the week ended 29 March to be tracking just below the long-run average of 113 (see next chart). According to ANZ, household’s view of the economic outlook is improving, which drove the


Gittins re-writes mining boom history

By Leith van Onselen Fairfax’s Ross Gittins has written a spirited post today chastising economists for not questioning the wisdom of the once-in-a-century mining boom, which drove-up the exchange rate and has now guttered other trade-exposed industries: Now we’re in the final throes of the decade-long mining resources boom, it’s a good time to reflect


Saxo Bank: 50% chance of Aussie recession

By Leith van Onselen Steen Jakobsen, chief economist at Denmark’s Saxo Bank, has given a stinging critique of the Australian economy, claiming that it is afflicted by a housing bubble and has a 50% chance of falling into recession. From Yahoo Finance: The mining boom had inspired laziness and arrogance… There’s dangerous levels of investment


Aussie banks borrow offshore like drunken sailors

By Leith van Onselen The release of the Australian Bureau of Statistics (ABS) National Financial Accounts yesterday revealed a large $33 billion (5%) jump in Australian banks’ gross external liabilities (offshore borrowings) in the December quarter, with borrowings now at all time record levels. This surge in offshore borrowings was driven by increases in One


More flawed arguments for a “Big Australia”

By Leith van Onselen The Australian’s David Uren wrote an extraordinarily one-eyed article yesterday in support of rapid population growth, which espouses all of the so-called economic positives without due regard for the negative consequences: …rapid population growth has been a vital support to the Australian economy since the global financial crisis… Apart from Luxembourg,


CommSec primes the population ponzi

By Leith van Onselen From CommSec this afternoon comes the following statements on Australia’s population (immigration) numbers, released by the ABS: Population growth is healthy although in recent quarter it has eased – largely due to a slowdown in migration. Importantly population growth is still amongst the fastest across the OECD nations and as such


Unions challenge overseas-sourced offshore labour

By Leith van Onselen The Maritime Union of Australia and the Australian Maritime Officers Union has launched legal action in the Federal Court to have the hundreds of foreign workers employed in offshore projects declared illegal. From The Canberra Times: [The Union] has argued a Ministerial Determination used by the Assistant Minister for Immigration and