Australian interest rates

How did anyone ever get on with AFR journalism when it was wrong and a day late?

Wages have been pancaked for six months in the national accounts. Westpac. Cost pressures continue to moderate as the impact of the larger than average 2022-23 minimum and award wage increase roll out of annual calculations. Average (non-farm) earnings per hour moderated to 3.2%yr, from 6.5%yr in the June quarter.

The revolt is building against Michele Bullhawk’s Psycho RBA.

On Monday, the Melbourne Institute (MI) monthly inflation gauge was released, which showed that inflationary pressure remained well contained in November.

Treasurer Jim “chicken” Chalmers has injected a whole new level of uncertainty into interest rates. His tax and spend economy has hoodwinked the RBA (not that that was hard).

The Australian Bureau of Statistics (ABS) today released retail sales data for October, which posted a third consecutive rise.

Michele Bullhawk appears to be a worker-hating psycho.

Earlier this week, Australian Prudential Regulation Authority (APRA) chairman John Lonsdale gave a speech to the European Australian Business Council. He noted that the number of Australians experiencing severe mortgage stress has nearly doubled from 2016 levels and is trending up amid the aggressive monetary tightening from the Reserve Bank of Australia (RBA).

National Australia Bank (NAB) has become a banking pariah, lobbying for easier first-time homebuyer access to mortgage credit to improve ‘housing affordability’.

Egghead economists are still refusing to admit the obvious—that energy rebates have killed inflation.

From the ABS. Markets expected 2.3% but got 2.1%. The monthly CPI indicator rose 2.1% in the 12 months to October. The most significant price rises at the Group level were Food and non-alcoholic beverages (+3.3%), Recreation and culture (+4.3%), and Alcohol and tobacco (+6.0%). Partly offsetting the annual increases in other Groups was Transport (-2.8%).

From a new Lunatic RBA FOI.

The lunatic RBA is back.

Right where the sadistic RBA wants it. Flash Australia PMI Composite Output Index(1): 49.4 (Oct: 50.2). 10-month low. Flash Australia Services PMI Business Activity Index(2): 49.6 (Oct: 51.0). 10-month low. Flash Australia Manufacturing Output Index(3): 47.9 (Oct:44.7).

This is ridiculous.

Morgan Stanley with the note.

CBA Senior Economist Stephen Wu has released the bank’s forecasts for the upcoming monthly CPI indicator. CBA expects the monthly indicator to record annual headline inflation of 2.1% in October, near the bottom of the Reserve Bank of Australia’s (RBA) target range of 2% to 3%.

Nothing better sums up the divergence of economic fortunes between young and older Australians than this week’s analysis of spending habits by age from the CBA.

The RBA minutes are out and again it is making absolutely no sense.

RBA assistant governor Christopher Kent spoke about how rising interest rates have hit Australian households particularly hard.

Chanticleer’s advice is a great contrarian port of call. Economist calls for the Reserve Bank of Australia to cut the cash rate early next year are dropping like flies. Even the ones left in the February 2025 camp are warning their calls may be too early (again).

ANZ and Westpac are debating why the RBA has no idea what it is doing.

The general consensus of economists is that the Reserve Bank of Australia (RBA) will begin to reduce the official cash rate in the first quarter of 2025.

From the ABS.