Australian Economy

Cross-posted from The Conversation: The Turnbull government’s signature economic policy at last year’s election was a 5% cut in the company tax rate, over a ten-year period, at a cost to revenue estimated to be in excess of A$48 billion.

From the AFR: BlueScope Steel chief executive Paul O’Malley says the energy costs of his booming North Star steel operations in the United States are five to 10 times lower than the firm pays in Australia as he warned of a potential energy catastrophe right across Australian industry.

UBS is happy: So Far So Good So far results have been tilted to the positive with the average revision to FY17 consensus EPS c+1%.

From UBS: ABS will introduce the 17th series of the CPI in 2H17 The ABS typically reweights the CPI every 5-6 years, with the 17th series due to be introduced in 2H17.

Via News: Corporate governance specialist John Adams, who was an economics and policy advisor to Senator Arthur Sinodinos and management consultant to a big four accounting firm, believes he has found seven disturbing signs that the global economy is primed for a major fall.

By Gareth Aird, senior economist at the CBA: We expect the fifth estimate of 2016/17 spending plans to come in near $107bn.

Big news here: Federal and state energy ministers will today be told by the Weatherill Labor government that it will “retake control” of South Australia’s fragile power network so blackouts “do not happen again”.

By Leith van Onselen Some sage words today from The Australian’s Adam Creighton, who has nicely encapsulated the Australian economy in just three paragraphs: Regulations that keep Australia’s house prices high and rising have dangerously distorted the economy, which is now highly dependent on rising house prices.

A few more charts on the labour market today from Morgan Stanley: There’s a modest improvement in the pipeline for the next six months.

Via the ABC: East-coast Australia’s domestic gas shortage is crippling some rural businesses, and has prompted one owner to accuse the nation’s politicians of treason.

By Leith van Onselen Another week and more reports have emerged on how Australia’s uncoordinated mass immigration program is destroying living standards in Australia’s biggest cities.

By Leith van Onselen Yesterday’s ABS labour force release for January revealed a much-needed improvement in labour market conditions for those aged 15 to 24 years old, albeit from highly depressed levels.

By Leith van Onselen As summarised earlier, the Australian Bureau of Statistics (ABS) today released its labour force report for January, which registered a 13,500 increase in total employment and a decrease in the headline unemployment rate to 5.7%.

From Morgan Stanley: Last October we launched the proprietary Morgan Stanley Housing Australia indicator, which is calibrated to lead the building approvals and dwelling price growth cycle by 3-4 quarters (see Australia Macro+: Australian Housing: Stressing the Foundations, 19 Oct 2016).

The ABS has released January Labour Force and the news is luke warm as part time still dominates: SEASONALLY ADJUSTED ESTIMATES (MONTHLY CHANGE) Employment increased 13,500 to 11,998,200.

From Westpac: The Westpac Melbourne Institute Index of Consumer Sentiment rose 2.3% in February, from 97.4 in January to 99.6.

From The Australian: The nation’s energy market operator is under pressure to fix its ­operations after revealing the key failures that triggered blackouts for 90,000 customers last week, during a heatwave that has escalated a political dispute over ­energy security.

From the always bullish CommSec: New vehicle sales remain healthy and it is not hard to see why people are updating their rides.

From Westpac: Worth noting this month: The 3% jump in the month is well within normal monthly volatility and the trend is broadly flat.

Cross-posted from Gareth Aird, senior economist at the Commonwealth Bank.

By Leith van Onselen A delegation of South Australia’s business leaders has cornered senator Nick Xenophon and demanded that he support the Turnbull Government’s company tax cut policy, while also pushing to ramp-up skilled immigration into the state.

From Westpac: • The NAB business survey reported that business conditions jumped sharply in January, increasing to the highest level since October 2007.

By Leith van Onselen The Australia Institute (TAI) has released another report, entitled Oligopoly money How a company tax cut would be wasted on big business, which argues that the Turnbull Government’s planned company tax cut would be unlikely to encourage the largest companies in Australia to increase investment.