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The Economy


Consumers reluctant to spend despite Christmas retail lift

Su-Lin Tan While retail sales in early December were up, consumers are anxious about spending.


Friendly fire: Is the economy a victim of the Coalition's war on wages?

Peter Martin dinkus Dinkus

PETER MARTIN Like the punchline to a joke, Joe Hockey saved the best twist in the Coalition's war on wages until the end.


As the mining boom ends wages just aren't what they used to be

Sandra Bell (right) with her daughter Amy Bell with children Donlo Williams and Megan Smith.

LUCY CORMACK Sandra Bell loves her job in childcare, but at 66 years of age she could happily retire, if not for the one thing holding her back.


Swiss National Bank adopts negative interest rate

The Swiss National Bank said the effect on rates paid on individual savers' accounts  was beyond its responsibility. Interest rates paid to savers in Switzerland are already extremely low, so there is little room for further cuts.

David Jolly Switzerland's central bank is starting to charge banks to hold deposits, moving to push down the Swiss franc amid turmoil in global currency markets and deflation concerns.

Housing market coming off the boil, with growth set to slow in 2015

There are many variables when buying property, and every negotiation has subtle differences.

ELIZABETH KNIGHT After 2½ years of rising prices, the housing market appears to be running out of steam.

Policy of inaction on multinational tax

Federal Treasurer Joe Hockey.

MICHAEL WEST Joe Hockey can say what he likes. The outlook for any substantial action on multinational tax shifting is bleak.

Why higher petrol prices would be good for you, me and Joe Hockey

Will petrol prices take a plunge for the Christmas season?

MICHAEL PASCOE Joe Hockey's budget was deeply unpopular, but here's a sensible idea that the punters will hate even more.

Comments 62


OECD slams Australian budget measures, 'close monitoring' required

Treasurer Joe Hockey: obsession with the budget deficit is impoverished, desperation thinking.

Peter Martin, Nassim Khadem The Organisation for Economic Co-operation and Development has taken aim at a raft of Australian budget measures, describing one as potentially unsustainable and another as needing close monitoring.

Comments 92

Budget warning: Treasury predicting thousands more job losses next year

Treasurer Joe Hockey has warned of further job losses next year.

GARETH HUTCHENS Treasury is predicting that thousands more people will lose their jobs next year than previously thought, and economists warn that much of the burden will fall on Australia’s youth

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Interest rate cut: Reserve Bank board opens door to a discount

MATT WADE Economists are asking the question after a cryptic clue in the minutes of the board's December meeting.


Oil explained: why the price is falling and dragging the sharemarket down with it

Oil prices have fallen after OPEC cut its forecast on 2015 demand.

STEPHEN CAUCHI OPEC's decision to keep pumping out oil despite big price drops has had major ramifications for the global and Australian economies. What's going on?


RBA eyes rate cut bets in December meeting minutes

RBA governor Glenn Stevens.

MARK MULLIGAN The Reserve Bank has taken on board market expectations of an interest rate cut in 2015, but has given no indication yet that it is considering such a move.


Budget update may be further drag on consumer confidence


VESNA POLJAK Treasurer Joe Hockey’s budget update has lent a further dovish element to the economic outlook which will support the case for interest rate cuts in 2015.


Weak commodity prices, slowing China economy to hit federal budget


BRIAN ROBINS In its Mid-Year Economic and Fiscal Outlook, the government has slashed to 6.75 per cent its forecast for China's economic growth for 2015.

Hard times ahead for Generation Less

Rick Feneley and Gareth Hutchens Since World War II, Australians have assumed their children would enjoy a better standard of living than they did. That assumption has been correct – until now. Rick Feneley and Gareth Hutchens report.

Take a chill pill and go have a confident Christmas

Not panicking ... Reserve Bank governor Glenn Stevens

MICHAEL PASCOE According to RBA governor Glenn Stevens, we still get at least 17,000 TVs for every tonne of iron ore. So go and have a confident Christmas.


Decoding the RBA's Glenn Stevens

RBA governor Glenn Stevens.

MARK MULLIGAN Economics and markets reporter Mark Mulligan looks at the key topics and takeaways from RBA governor Glenn Stevens' latest in-depth interview, during which he said the Australian dollar would "probably be better" being closer to US75¢ than US85¢.


RBA governor Glenn Stevens says Australian dollar 'better' at US75¢

Reserve Bank of Australia governor Glenn Stevens.

Jacob Greber and Michael Stutchbury Reserve Bank of Australia governor Glenn Stevens wants the dollar to fall to levels last seen a decade ago.


Australia's budget woes unlikely to threaten AAA ratings

Joe Hockey's budget headaches are unlikely yet to lead to higher borrowing costs for the country, credit analysts say.

Australia is likely to keep its triple-A ratings even as the government's looming budget review is set to show a marked deterioration in its finances, two ratings agencies said on Thursday.

ACT unemployment rate rises to 5.2 per cent

The ACT’s unemployment rate had a slight increase to 5.2 per cent in November

CLARE COLLEY The ACT’s unemployment rate had a slight increase to 5.2 per cent in November following the national trend where it rose to 6.3 per cent.


More in work, more unemployed and the unemployment rate at a long-term high

Confusing job figures

PETER MARTIN More of us are employed than ever before, yet we are putting in fewer hours than at any time in the past six months.


Australia's unemployment rate rises despite record new jobs

Unemployment edged up to 6.3 per cent.

MARK MULLIGAN Australia’s unemployment rate rose slightly, to 6.3 per cent, in November, despite the creation of more than 40,000 jobs during the month.


Downbeat economic indicators a 'a very disturbing result'

Christmas shoppers in Sydney's Pitt Street Mall.

Mark Mulligan, Madeleine Heffernan Further evidence of flagging consumer sentiment and a cooling housing market on Wednesday added to gathering gloom about the Australian economy and piled more pressure on the Reserve Bank of Australia to cut interest rates next year.

Consumer confidence slump: Should we worry?

Australian business has been sitting on the sidelines, says Westpac's Bill Evans.

GARETH HUTCHENS Consumer confidence has now fallen so low that it is back to financial crisis levels.

Comments 131


Housing loans rise 1 per cent in latest ABS reading

Australians have $1.34 trillion in housing loans outstanding.

MARK MULLIGAN The total value of housing-related loans excluding alterations and additions rose 1 per cent, seasonally-adjusted, between September and October, according to the Australian Bureau of Statistics.


Consumer confidence plunges to 3-year low

Concern about job security and the economy have pushed consumer confidence to the lowest level since August 2011.

MARK MULLIGAN Consumer sentiment plunges to "very disturbing" levels amid waning optimism for the housing market and concerns about job security, Westpac says.


Financial regulators united in attack on risky loans

Moves to curb risky lending could take some of the heat out of Sydney and Melbourne's property markets.

Georgia Wilkins and Nassim Khadem Australia's financial regulators have launched a joint attack on risky home lending as investment and interest-only loans threaten the stability of the financial system.


Watchdog APRA cracks down on risky home lending with 'macroprudential' measures

Record low interest rates, high household debt and strong competition are ramping up risk in the home lending market.

The banking watchdog is cracking down on risky mortgage lending as the property market heats up.

Coalition runs out of business confidence

The business confidence that the Coalition's election brought has largely evaporated.

MICHAEL PASCOE The Coalition has blown all the lift in business confidence its election had delivered.

Australia adrift: Lost decade beckons as good fortune wanes

The Coalition's policies have effectively made Australia more dependent on China, argues William Pesek.

William Pesek The solution to Australia's challenges remain smart, forward-looking, and yes, costly, policy initiatives

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NAB predicts two interest rate cuts after gloomy business confidence survey

NAB has joined the ranks of those predicting interest rate cuts in 2015 as the economic outlook grows more gloomy.

Vesna Poljak and Mark Mulligan National Australia Bank on Tuesday became the second of Australia's big four banks to change its call on interest rates next year after its closely-watched business survey revealed gloomy findings supporting rate cuts in 2015.


Homebuyers warned lower interest rates won't be 'new normal'

Homebuyers can't expect record-low interest rates to last forever.

LUCY CORMACK Respected economists are tipping a cash rate cut from the Reserve Bank early in 2015, but analysts are warning first home buyers of thinking low rates are the new normal.

Oil price falls put Christmas cash in consumer pockets


STEPHEN CAUCHI Australian petrol prices are near 30-month lows but could fall another 10¢ a per litre, according to Commsec says.


Slight lift in job ads as employment market 'stabilises'

The number of jobs lifted slightly in November, but the slowdown in mining activity continued to weigh.

MARK MULLIGAN The number of jobs advertised online and in printed newspapers climbed 0.7 per cent during November, suggesting a lift in employment in the months ahead, according to ANZ.

Murray Inquiry's key recommendations

A matter of trust: Financial system inquiry chairman David Murray.

Jonathan Shapiro The inquiry made 44 recommendations, here are the key points


Hiring surge as US gains most jobs in three years

November saw the US economy add the most jobs in three years.

Victoria Stilwell A November hiring surge ranging from factories to offices and retailers powered the US economy to create the largest number of jobs in almost three years.

Reserve Bank caught in a Christmas cone of silence

Malcolm Maiden - dink - dinkus - thumbnail

MALCOLM MAIDEN One thing worth remembering as the market places bets that the Reserve Bank will cut its cash rate rapidly is that the bloke who runs it aims to move methodically.


Doing more with less as incomes shrink

Illustration: Simon Bosch.

MARK MULLIGAN Although the value of the goods and services produced in Australia continues to expand, the income flowing to Australians is shrinking.

The lessons we have learned on recession

Ross Gittins dinkus Dinkus

ROSS GITTINS With the economy growing below par and spirits so flat that people have started making up new and silly terms like "technical income recession" just to spook us, it's time we put our present discontents into context.


We don't dodge tax, it's Google, claim rich Australians


NASSIM KHADEM Laws that force wealthy owners of private businesses to divulge their business income and how much tax they paid will do nothing to bring in revenue, but instead are seen as a gross invasion of privacy.


Australian wages growth hits the wall

The end of the mining boom has rapidly slowed wages growth in Australia.

MAX MASON Australian wages rose more than in any developed G20 nation between 2007 and 2013. But then something changed.

World economy

Grandmaster Flash’s inflation rap outdated in lowflation world

Simon Kennedy and Rich Miller Three decades ago, Ronald Reagan called surging prices "as violent as a mugger," while Grandmaster Flash rapped about "double-digit inflation" making him "wonder how I keep from going under."      

RBA does the interest-rate cut three-step

Jawboning: RBA governor Glenn Stevens has said the RBA will give plenty of warning if it decides on a different course for interest rates.

MICHAEL PASCOE This week was marked by the start of the Reserve Bank three-step, a dance that could finish with the bank changing its cash rate.


Tony Abbott risks recession as his infrastructure pledge falters

Abbott's promised

A year after Tony Abbott pledged to be an "infrastructure prime minister", he risks becoming the first Australian premier to preside over a recession since the early 1990s, in part due to the snail's pace of new building projects.


No tax cuts on agenda to boost GDP, say economists

Despite a weaker-than-expected September quarter GDP figure of 0.3 per cent, economists still believe the nation is on track for 2.5-3 per cent growth in 2015.

STEPHEN CAUCHI The Government is unlikely to deliberately loosen fiscal policy in the forthcoming Mid-Year Economic and Fiscal Outlook to try and stimulate growth, according to economists.


Westpac's Bill Evans joins growing RBA interest rate cut rush

Westpac's Bill Evans is tipping an interest rate cut

GARETH HUTCHENS One of Australia's most watched chief economists believes the Reserve Bank will have to cut the cash rate dramatically in coming months in a bid to pump life into a quickly-deteriorating economy

Australia's economy is still growing, so why does it feel like we're struggling?

It doesn't matter how much we are producing, but how much we are earning off the back of that, says Chris Richardson, from Deloitte Access Economics.

GARETH HUTCHENS Australia has an economic growth rate that is still the envy of the developed world, so why does it feel like we are struggling?


Retail sales beat expectations in October

Retail sales were bolstered by higher spending on clothes and shoes.

MARK MULLIGAN Australians continued to spend more on household items, electronics, clothing and footwear in October, although the rate of growth across all retail categories slowed to 0.4 per cent from an unusually-high 1.3 per cent in September.


Global tax war looming and US won't be backing down

Randy Robason.

NASSIM KHADEM The United States won't give up its right to tax multinationals, and nations will go to war soon with countries like China on taxing rights, a US tax head says.

GDP weak but not conclusively so

Malcolm Maiden dinkus Dinkus

MALCOLM MAIDEN There is income weakness in the economy and it throws up similar questions for the government and for investors.

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