RBA Independence or should that be spelt “dance…” was one issue discussed during the Senate Economics Legislation Committee on Thursday 15th February 2024.
Senators Nick McKim and Gerard Rennick quiz RBA Governor Michelle Bullock during the hearings. Highly relevant given the current proposed legislation to remove Government oversight of their activities.
Segments on other issues will follow. Here is the link to the full hearing (1:30:00) https://www.aph.gov.au/News_and_Events/Watch_Read_Listen/ParlView/video/2174307
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Last month Australian employment surprisingly tumbled in December, snapping four months of gains and sending the currency lower as traders boosted wagers on the Reserve Bank switching to policy easing this year. The economy had shed 65,100 roles, led by the biggest monthly drop in full-time employment since the height of pandemic, but unemployment held at 3.9%, cushioned by a sharp fall in the number of workers seeking jobs.
Now we got the next update from the ABS which showed that the economy added just 500 roles in January, confounding expectations for a 25,000 gain and well shy of numbers needed to hold down the jobless rate.
Unemployment advanced to 4.1% from 3.9% while the participation rate was steady. The number of people considered officially unemployed increased by 22,000.
“This is another sign of moderation in jobs demand,” said Diana Mousina, deputy chief economist at AMP Ltd. “I still don’t think that you can justify a near-term rate cut right now because the labor market still looks tighter than before the pandemic. It’s loosened, but not enough to get worried about.”
NAB’s Tapas Strickland noted the labour market was still tight and said the central bank would likely wait for next month’s data before drawing any firm conclusions. “If the lift in the unemployment rate is sustained, then that would suggest a softening in the labour market is occurring faster than the RBA’s track, which could give the RBA greater confidence in their forecasts of inflation heading back to the mid-point of the band,” said Mr Strickland.
But frankly, the numberwanging is all over the shop.
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Digital Finance Analytics (DFA) Blog
Unemployment Wobbles Higher In January, But Don’t Expect Quick Rate Cuts!
I have been covering the disgusting story of construction defects across Australia for some time. In January we published a post titled “Wanted: More High-Rise Purchasers Willing To Play Russian Roulette! First Time Buyers are the biggest victims!
And lets be clear, while the problem is Australia-wide, New South Wales does appear to be at the epi-centre thanks to the privatisation of building inspections, the drive for quick construction at low cost, and unprecedented demand to meet supply. And of course recent proposed planning changes means more high-rise more quickly built. The disaster continues.
There are no real guarantees on current new construction, despite recent changes. So my message to first time buyers who are already under the pump financially, is to be very careful. Make sure you do your own due diligence. Caveat Emptor!
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Today’s post is brought to you by Ribbon Property Consultants.
Digital Finance Analytics (DFA) Blog
First Time Buyers Are At The Pinnacle Of The Building Defects Boom!
Sydney is at risk of becoming “the city with no grandchildren”, a senior government official has warned, as high housing costs drive young families to leave.
The state capital is losing twice as many people aged 30 to 40 as it gains, according to a paper by the NSW Productivity Commission. “If we don’t act, we could become a city with no grandchildren,” the agency’s commissioner Peter Achterstraat said.
The exodus of that group is a problem, according to Mr Achterstraat, because people in that age range are among the most productive in the workforce.
“They’ve generally completed their training, they’ve had 10 or more years’ experience, and the majority are tech savvy,” he said.
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This is my edit of our monthly economic update on Nuggets News, as we explore the current trends across markets and economies. Things are getting interesting as higher for longer plays out.
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This is an edited version of our live discussion about the current state of play of mortgage, rental and financial household stress across Australia, based on our latest surveys and modelling. We had our post code engine online.
Find out more beforehand by watching this show: Many Households Are In Trouble – Mate! https://youtu.be/np4H9RkPqEo
Original live version with chat here: https://youtube.com/live/Qs__lYQMhP4
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Digital Finance Analytics (DFA) Blog
DFA Live Q&A Replay: Latest Household Financial Stress And Modelling
Another dose of reality from our property insider Edwin Almeida. What political games are being played at the moment, and how is this influencing markets, which according to some are taking off again. Or does it depend on where you look and who is buying. How big is the housing crises now? Will any of the “solutions” being discussed really assist?
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Today’s post is brought to you by Ribbon Property Consultants.
If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.
Buying property, is both challenging and adversarial. The vendor has a professional on their side.
Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.
Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.
Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.
Here we answer viewers specific post code requests, following our recent show discussing Household Mortgage, Rental and Financial stress last week “Many Households Are In Trouble – Mate!” https://youtu.be/np4H9RkPqEo
On Tuesday 13th February in our live show we will discuss this further, so if you have additional requests for post code level analysis, drop them in the chat.
You can get more info about our One to One service here: https://digitalfinanceanalytics.com/blog/dfa-one-to-one/
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Digital Finance Analytics (DFA) Blog
Post Code Level Household Financial Stress: You Asked, We Answered!
This is our weekly market update, starting with the US, Europe, Asia and Australia, as well as Oil and Crypto.
The S&P 500 soared to fresh highs on Friday, but fewer stocks have been participating in the rally, stirring worries that recent gains could reverse if the market’s leaders stumble.
We are talking market breadth, or the number of stocks taking part in a broader index’s rise. A high breadth is often viewed as a healthy sign by investors as it shows gains are less dependent on a small cluster of names.
The reverse, a narrowing, on the other hand is a warning. And in fact, the Magnificent Seven have accounted for nearly 60% of the S&P 500’s gain this year, according to Dow Jones Indices.
The problem is the narrow group of stocks powering the market could make it more vulnerable to swift declines if an earnings disappointment or other issue hits its biggest stocks. While most of the megacaps have powered higher this year, shares of Tesla have fallen 22%, the third-worst performer in the S&P 500, demonstrating how quickly the market’s superstars can fall out of favor.
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Reserve Bank governor Michele Bullock was back in front of the bright lights, appearing at a House Economics Committee Hearing on Friday.
I have selected the edited highlights in this show, from the 3 hours of questions, and have included some of her statements. While she didn’t add a whole lot more to what she said at Tuesday’s press conference, she emphasised two points that should give pause to those expecting multiple rate cuts this calendar year.
The first was in response to a question on inflation expectations: by the time inflation gets back to the midpoint of the target band of 2 per cent to 3 per cent, as required by the RBA’s new mandate – which occurs some time beyond the middle of 2026 on the RBA’s latest forecasts – inflation will have been outside the target range for four years, which is right on the edge of what the RBA will tolerate.
The second was on productivity.
But she also touched on the risks in the forecasts, the impact of the Bank of Mum and Dad, and other distributional impact questions across households. Frankly, I found this unconvincing. So the think the RBA has much to do to gain a better set of insights into the current state of play!..
Let me know what you think in the comments!
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Digital Finance Analytics (DFA) Blog
Which Households Are Hurting The Most - According To The RBA?
