From the AFR: Empirically, the Australian currency tends to weaken when commodity prices fall or when domestic interest rates fall relative to those in the United States. It is reasonable to expect the fall in commodity prices since 2011 would weaken the Australian dollar. Similarly the announcement of tapering or an end of quantitative easing
From the AFR: The Reserve Bank of Australia’s move to a “neutral bias” on monetary policy has angered the Abbott government, which believes any upward pressure on the dollar makes economic management in the next two to three years more difficult. The central bank has been informed directly of Treasurer Joe Hockey’s displeasure. The Reserve
Above is a must watch video interview featuring Senator-elect, Bob Day, explaining to Business Spectator’s Alan Kohler why Australia’s housing policy is a complete failure and what can be done to fix it. The interview follows Day’s eye-opening submission to the current Senate standing committee on affordable housing, which fleshed-out the issues in greater details.
From Reuters over the weekend: China’s home price inflation slowed to an eight-month low in March, extending to a third month a loss of momentum in a property market that has been a strong spot in the world’s second-largest economy. Average new home prices in China’s 70 major cities rose 7.7 percent in March from a
From The Australian over the long weekend: SYDNEY entrepreneur Roland Frank Bleyer first came to national attention in 1985 when TV host Mike Willesee grilled him on air over a business that was using animal foetal cells to treat children with Down syndrome. It might have been just another TV interview, save for the fact
Here is the latest in our recent series of aerial shots of Australian major projects. Gorgon, the capital-eating monster: Courtesy of Chevron.
Here are the iron ore charts for April 21, 2014: The top is in. Paper markets have rolled. Rebar futures are almost back to recent lows. Physical is closely following. The Baltic Dry capesize component fell another 5% over the long weekend and rebar average has peaked. Port stocks appear to have topped too
Global Macro / Markets: Forget Passive vs. Active–Here’s How To Evaluate Any Investment Strategy – Millenial Invest North America: Wall Street deregulation pushed by Clinton advisers, documents reveal – The Guardian Princeton Study: U.S. No Longer An Actual Democracy – Talking Points Memo 5 Questions on the State of Mortgage Lending – Wall Street Journal
China Premier Li Keqiang rules out strong stimulus despite weaker growth (SCMP) Why China’s haste to internationalise the renminbi? (Bruegel) Towers where no lights burn at heart of China’s puzzle (FT.com) China must resist the temptation of economic stimulus for quick relief (SCMP) Rumours of a Chinese crash are greatly exaggerated (SCMP) Sustainability
By Stan Shamu for Chris Weston, Chief Market Strategist at IG Markets Asia is mixed heading into the Easter break in a relatively quiet session. There has been some activity out of Japan with BoJ Governor Haruhiko Kuroda on the wires along with weekly fund flows data. Kuroda remained optimistic about the recovery and reinforced
By Leith van Onselen Business Spectator’s Callum Pickering has written another good article today on a particularly important issue: Australia’s growing youth unemployment: Australian society is failing its youth and setting itself up for economic disaster. The persistent rise in youth unemployment will reverberate across the economy for decades to come, potentially reducing productivity and
Please find below an interesting debate between economist, Matt Cowgill, and Godfrey Moase. Assistant Secretary of the National Union of Workers General Branch, on housing policy. The debate was in response to an article that Matt wrote in The Guardian late last year in which he challenged the notion that affordable housing can be achieved
If you get a spare half an hour today, check-out the above documentary from CNBC entitled The Bitcoin uprising. In the video, CNBC’s Mary Thompson takes a detailed look at Bitcoin by speaking to the currency’s faithful, who believe the open source currency will upend the global financial system. Thompson also speaks to those who
By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released new motor vehicle sales for the month of March 2014, which registered a 0.3% seasonally adjusted fall over the month and a 2.8% decrease over the year (see next table). It was the third consecutive monthly decline in sales. Sales in March
By Leith van Onselen In case you missed it, attached is an interesting debate aired last night on ABC’s The Business on the merits of negative gearing. In the one corner is Saul Eslake, chief economist at Bank of America Merrill Lynch, arguing (as I have done) that negative gearing is a wasteful policy that
By Leith van Onselen Around six months ago, I attended a friend’s bucks party in Melbourne’s CBD. As bucks nights usually go, we ended up at some seedy bars along King Street, where the night ended around 2 am. As is so often the case in Melbourne, we were unable to find a taxi. Luckily
By Leith van Onselen In the week ended 17 April 2014, the RP Data-Rismark 5-city daily dwelling price index, which covers the five major capital city markets, rose by 0.37%. It was the seventh consecutive weekly rise in values (see next chart). Values rose in four major capitals and fell in one (see next chart).
By Leith van Onselen While driving home from the swimming pool on Tuesday night, I listened to an ABC radio interview featuring former leader of the National Party, Tim Fischer, alongside Beyond Zero Emissions’ Gerard Drewe, lamenting how the proposed second Sydney airport would lessen the prospect of building a high speed rail line linking
By Leith van Onselen Melbourne’s “build it and they will come” approach to construction, which has seen it rank high-up on the global skyscraper index, appears to be suffering more indigestion. Following recent reports that CBD and St Kilda Road vacancies have rocketed and rents plummeted, as apartment supply runs well above demand, The AFR
By Leith van Onselen The Australian’s Particia Karvelas has produced a good article today explaining why making childcare tax deductible and removing the $7,500 cap, as proposed by several submissions to the Productivity Commission inquiry into childcare, would be a bad deal for lower-to-middle income families: The chief executive of advocacy group Early Childhood Australia,
By Leith van Onselen Yesterday’s dwelling construction data, released by the ABS, revealed a fall in actual completions over the December quarter, but a big pick-up dwelling commencements, which are following approvals upwards. The below chart, presented below in rolling annual terms, summarises the situation well, with approvals and commencements finally beginning to catch-up to
By Leith van Onselen “Highrise Harry” Triguboff is reportedly considering selling Meriton Apartment’s development business to a Chinese developer, in a deal that would net him close to $3 billion. From The AFR: Triguboff told AFR Weekend he received an offer for his business on a trip to China two weeks ago from the owner
By Leith van Onselen SQM Research has released rental vacancies data for March, which revealed a 0.1% monthly fall in the national vacancy rate to 2.0%. Year on year, vacancies are also down 0.1%, bucking the trend for the first time in several months where we have witnessed a loosening of vacancies when compared to
Westpac has released its March quarter consumer price index (CPI) forecasts, with the bank seeing inflation edging-up to a headline 0.9% QoQ/3.2% YoY (from 0.8% QoQ/ 2.7% YoY) and an underlying 0.7% QoQ/ 2.8% YoY (from 0.9% QoQ/ 2.6% YoY): Our Q1 headline CPI forecast is 0.9%qtr/3.2%yr. Core inflation, as measured by the average of
Here are the iron ore charts for April 16, 2014: And so the paper market weakness rolls on. None of these charts look especially comforting and may all be forming head and shoulders top patterns. Rebar futures fell sharply too. In physical it’s increasingly as bad with the rebar recovering stalling and the Baltic Dry
