The latest from the ABS shows again real weekly earnings rose, but failed to keep up with inflation – though the gender gap closed a little. Best place to earn more in the ACT or WA, in the public sector, or mining.
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The RBNZ Team lead by Adrian Orr was questioned in Parliament today, and we got more insight into the trajectory of rates, and the impact on households, with the debt servicing ratios set to rise higher than before the GFC! There was a sharp intake of breath!
In addition, there was a concession to the fact that if lending had been tighter, QE and money printing more controlled, then inflation would be lower. Is this the first time a Central Banker admitted this?
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Adrian Orr, RBNZ Governor said they were listing the Official Cash Rate by 0.5% today, with a peak of 5.5% still on the cards. The recent Cyclone may also add additional inflationary pressure.
He also highlighted the importance of cash – and branches – at a time of crisis, like when the power goes out. And the risks to social cohesion when this is ignored. Just wow!
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The latest PMI data was strong, but the markets took it as a signal of more FED rate hikes, so the indices dropped. More evidence that good news in bad news. And more analysts are not calling a higher terminal rate, and lower markets, as earnings slump.
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Join me for a live discussion with Meighan Wells about the state of QLD property, with a focus on Brisbane.
As the Principal of Property Pursuit and co-founder of the Home Buyer Academy and co-presenter of Your First Home Buyer Guide Podcast, Meighan is committed to excellence and the swelling list of satisfied clients as well as its multi-award-winning status is a testament to her ethics and hard work. In recognition of her expertise and high standards in the fast-growing buyer’s agency industry, Meighan was engaged to develop and deliver the education module for the REIQ course Acting as a Buyer’s Agent and is the former Chairman of the REIQ Buyers’ Agent Chapter.
In 2010, Meighan was awarded the highest honour for buyer’s agents when she was recognised as the REIQ Buyers Agent of the Year for the third consecutive year. As a recognised expert on the Queensland property market, Meighan is regularly featured in the media in publications including The Financial Review, The Australian, The Courier Mail, Sunday Mail, Sydney Morning Herald, Australia Property Investor Magazine, Your Mortgage Magazine, Realestate.com.au, Domain.com.au, Property Observer and more.
You can ask a question live.
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The RBA minutes today revealed they considered both 50 and 25 basis points rate hikes at their last meeting – but no thought of holding rates. So it was not a close decision, the RBA turned more hawkish.
And more rate hikes must be expected, while inflation won’t drop into 2-3% range until 2025.
So expect more rate hikes and higher for longer, with a following fall in wealth and output. This all aligned with the Governor’s comments last week to Parliament.
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The RBA Governor was before the Economics Committee in Parliament last Friday. Questions from members were more coherent, but the responses were similar to those in the Senate on Wednesday.
Two points of note were the distribution of debt (and so pain) across the community, and the question of whether the rate of increases mattered more than the end destination.
But I was not convinced by their answers…
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We are in an era of complexity – yet some claim there are simple answers out there. We think this is untrue. The complexity is real, and some scenarios are very complex. So beware the “simple” solution!
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