The Economy


NSW powers ahead in economic stakes

Matt Wade 1:02 AM   A new economic comparison tool, the "Stateometer", shows NSW is in an enviable position.

US judge finds class actions aid economic honesty

US Judge Jed Rakoff is in Melbourne for a symposium on class actions.

Sarah Danckert 12:34 AM   Eminent US Judge Jed Rakoff is in Australia to deliver the keynote speech for the Maurice Blackburn and Business Day class action symposium.

RBA leaves cash rate on hold

The RBA has kept rates on hold at a record low 2 per cent.

Mark Mulligan 6:02 PM   Despite sluggish domestic growth and a sharp fall in the terms of trade, the RBA is reluctant to cut rates further, preferring the weaker Australian dollar and already low cost of credit to fuel investment, spending and non-mining exports.

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Net export surprise could force GDP downgrade

ABS said second-quarter deficit on goods, services and capital widened to just above $19 billion from $13.5 billion in January-March.

Mark Mulligan 12:28 PM   Australia current account deficit surged 40 per cent in the second quarter, increasing the chances that growth in the three months ended June 30 will fall well short of forecasts.

Warning: nice fuel prices won't last

Higher petrol prices to come.

Daniella Miletic 11:40 AM   Skyrocketing price for US crude oil will mean pain at the bowser for us.

Michael Pascoe

Animal spirits: Business herd needs to be bolder

Michael Pascoe

Michael Pascoe   You can't keep downsizing your way to executive bonuses indefinitely

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Business data prompt GDP downgrade

Operating profits fell 3.9 per cent on the year, in line with expectations.

Mark Mulligan   Business stock was flat in the June quarter, while sales dropped slightly and gross operating profit fell for the year.

Michael Pascoe

Your week wasn't this bad

Michael Pascoe

Michael Pascoe   If you've had a rough week courtesy of market volatility, just consider how much worse it could have been.

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Consensus worth a try to fix the budget

Ross Gittins

Ross Gittins   It was easy to miss, but a proposal with much practical potential arose from this week's meeting of the great and good at the National Reform Summit. It was an idea that could break the budget impasse.

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Australia Post applies for $1 stamp

Post box.

Australia Post is seeking an almost 43 per cent increase in the price of postage stamps.

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China likely to trigger global recession: Citi

China is seeking to defend its 7 per cent economic growth goal at a time when concern over its slowing economy is fuelling volatility in global markets

Sangwon Yoon   China's leaders will act too late to avoid a major downturn, says the economist who brought you the term 'Grexit.'

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US income data provides reality check

Michael Feroli, chief US economist for JPMorgan Chase, said he still gives more weight to the GDP number, but the low GDI growth rate does affect his thinking.

Peter Coy   Not many people noticed that US gross domestic income increased at an annual rate of just 0.6 per cent.

Investment still weak, but rate of decline slowing


Mark Mulligan   Business investment continued to contract sharply in the June quarter, and won't improve any time soon, ABS capital expenditure survey shows.

Why you should pay more GST and less income tax

Jessica Irvine

Jessica Irvine   Taxes are the price we pay for all the public services we demand of government. They are a necessary evil. So how do we decide which taxes are more or less evil?

NSW stays strong as home building boom peaks, says Boral

Some 30 per cent of Boral's $4.3 billion in revenue comes from Australian housing.

Tim Binsted   Boral's boss has dismissed the row over royal commissioner Dyson Heydon's integrity as a distraction from a crisis in the construction industry.

Former Treasury boss sounds recession warning

Former Treasury head Martin Parkinson warned that Australia could sacrifice as much as 5 per cent of the economy in missed economic growth.

Peter Martin   Australians are "sleepwalking into a real mess", facing the equivalent of a recession in the next ten years as income growth looking far lower than officially forecast, the National Reform Summit has been told.

More volatility could force RBA's hand

A group of forecasters says weak inflation could contribute to a rethink in Australian interest rates.

Mark Mulligan   Further market volatility could force a rethink by the Reserve Bank of Australia on its next interest rate move.

Reform agenda is in the wrong hands

Michael Pascoe

Michael Pascoe   Too bad it's politicians we rely on to drive economic reform.

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Bait and switch habits are slow to die

Ross Gittins

Ross Gittins   Beware of treasurers promising to protect you from the ravages of bracket creep. They're like Mafia bosses promising to protect you from robbers and thieves.

Reducing gas use might be as easy as turning on your air conditioning

Authors of a new study say heat pump technology can heat a house as comfortably as gas-ducted heating, but at much lower costs.

Tom Arup   Thousands of Victorian households are¬†missing out on cheaper bills because they are not using their already installed reverse¬†cycle air conditioners to heat their homes as an alternative to gas systems.

October US Fed Reserve rate rise on Wall St radar

Janet Yellen, chair of the US Federal Reserve.

Traders and investors have been betting for months and October is a long shot, but Wall Street isn't ruling it out.

Bets on third rate cut surge amid ASX sell-off

Bond traders are now pricing in a 76 per cent chance RBA cash rate cut by November after the latest stock market rout.

Mark Mulligan   Interest rate swap markets now showing a 76 per cent chance of a 25 basis point reduction by the November board meeting of the RBA.

NBN blowout may hike cost of internet: M2

The federal government has not increased its funding cap of $29.5 billion, meaning NBN will have to raise up to $26.5 billion from private sector sources including banks, bond raisings and international markets.

David Ramli   M2 Group boss Geoff Horth warns the $15 billion blowout in the cost of building the NBN could make the internet more expensive for Australians.

Malcolm Maiden

NBN blowout pressures government

Malcolm Maiden

Malcolm Maiden   The big NBN blowout asks the question anew: was it worth scrapping Labor's full-blown project?

Does this graph explain why our cities are clogged?

Ross Gittins

Ross Gittins   Huge infrastructure projects have great appeal for some but are less economically effective than doing maintenance.

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The most important economic chart this week

Dark days for the world oil industry.

John McDuling   It was another seismic week in global business. But if you look at only one chart, make it this one.

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Michael West

Who wants to grab a billionaire?

Michael West

Michael West   The Rich Mates Act amendment bill was introduced to Parliament on Thursday.

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Will Ashley Madison hack cost the economy?

Ashley Madison is, and always was, a terrible and very expensive way of having an affair.

Josh Barro and Justin Wolfers   Divorce is expensive, so could the Ashley Madison hack hurt the economy? Or even help it?

Victoria, NSW at odds on tax reform

Victorian Treasurer Tim Pallas says that after compensation a proposed increase in the GST from 10 to 15 per cent would raise very little for states.

Peter Martin   NSW and Victoria are at loggerheads going into Friday's tax reform meeting, with NSW wanting an increase in the GST, while Victoria wants a higher Medicare Levy.

Why the Fed is wishy-washy on rate timing

Mohamed El-Erian says he would have raised interest rates in the US already.

The US Federal Reserve will remain noncommittal until the very last moment, says Allianz's Mohamed El-Erian.