Australian Economy

David Bassanese has a whinge about the RBA: …so far at least, lower official interest rates have gone down like a lead balloon with households and business.

A beefy warning today from NCK: That’s serious fall. The problem for NCK (and the economy) is this: Despite crazy migration flows, household formation is slowing fast as new builds crater.

Three months ago, the Grattan Institute released alarming research showing the rapid expansion of migrant workers across the Australian economy, which Grattan labelled “predominantly low-skill migration”.

Via ANZ:  ANZ Roy Morgan index was down 1.2% last week, its second straight weekly loss – ensuring confidence remains below its long-run average.

Via a sad and sorry CBA: Retail spending intentions have dipped while home buying intentions remain high, according to CBA’s latest research.

Via the excellent Damien Boey at Credit Suisse: Our proprietary measure of the Australian credit impulse has picked up to 5.6% annualized in August, from 4.9% in July, and 4.6% in June.

The NSW regional city of Tamworth is currently facing Stage 4 water restrictions, with the Chaffey Dam at just 18.9% capacity after experiencing record low inflows: The Peel Valley region is also predicted to run out of water by June 2020 unless there is significant rain fall.

Deloitte today in its latest business outlook: Global growth is still slowing.

Exclusively from Gerard Minack: House prices bounce but Australia remains stagnant Australia’s housing correction is, for now, over.

Via the excellent George Theranou at UBS: Based on our proprietary survey, our Q3 headline CPI forecast is unrevised at 0.4% q/q, slowing from Q2’s bounce to 0.6% (driven by petrol). This is partly due to retracement of fuel (-2.3%, -0.07%pts); while the UBS Evidence Lab Grocery Tracker has food up 0.7%.

Oh yes, via the AFR: Treasurer Josh Frydenberg has rejected a renewed push by NSW to bring back federal incentives for state asset recycling, a privatisation scheme designed to help fund large infrastructure projects, saying the state’s budget is in better shape than the Commonwealth’s and needs no more handouts.

With Victoria’s population growing out of control on the back of turbo-charged immigration: And Melbourne’s population projected to more than double over the next half century: You would think that the Victorian State Government would be seeking to boost the stock of social housing in order to prevent vulnerable residents from becoming homeless.

Via The Australian comes the oligarchs: Fortescue Metals Group boss Elizabeth Gaines has warned that China will look to develop alternative iron ore supplies outside the Pilbara if Australia neglects its relationship with its biggest trading partner…Ms Gaines said the Australian business community needed to maintain its influence in public debate on political policies.

More trade scuttlebutt this afternoon, via Bloomie: The White House is looking at rolling out a previously agreed currency pact with China as part of an early harvest deal that could also see a tariff increase next week suspended, according to people familiar with the discussions.

Recessionberg!

The Joint Standing Committee on Trade (JSCOT) has released its report rubber stamping the Hong Kong and Indonesia Free Trade Agreements (FTAs).

Cross-posted from One Step off the Grid: The calendar says winter is over.

Oh yes, via Damien Boey at Credit Suisse: Over the past few days, we have witnessed some rather sharp deterioration in the leading indicators of Australian growth: Westpac consumer confidence fell sharply in early October to 92.8 from 98.2.

The ABC has published an interesting profile on the outer-Western Melbourne suburb of Tarneit, which is fast morphing into a modern migrant slum nightmare: When the Bahadur family moved into their new home in Melbourne’s booming outer west four months ago, they dreamed of suburban bliss.

Via the AFR today: The chair of the Energy Security Board Dr Kerry Schott says the rapid take-up of household rooftop solar panels in Australian cities is causing energy security problems for energy distribution companies.