Business investment, a key component of economic growth, jumped its most in four years during the September quarter, suggesting that the local economy is starting to pick up a head of steam.
Business investment, a key component of economic growth, jumped its most in four years during the September quarter, suggesting that the local economy is starting to pick up a head of steam. A boom in new data centres pushed new capital expenditure 6.4 per cent higher, well ahead of expectations. Yesterday’s data feeds into next week’s September quarter GDP figures and will give them a boost. Business investment has been a missing piece of the economic puzzle in recent years, and yesterday’s ABS figures augur well for growth. The data comes as a slew of economic indicators and anecdotal evidence suggest a pickup in the economy.
The financial services regulator, APRA, has introduced new restrictions limiting how much banks can lend, and how much some borrowers can receive, as it grows wary of rising risks in the property market. APRA will limit loans made by banks for mortgages to six times the borrower’s income.
Barnaby Joyce has formally resigned from the Nationals, ending his 20-year parliamentary career with the party, and clearing the way for him to join right-wing minor party One Nation.
Prime Minister Anthony Albanese has done a deal with the Greens to pass Labor’s overhaul of Australia’s environment laws, on the last day before parliament breaks for the summer recess.
Cricket Australia is aiming to raise $600m from the partial privatisation of the Big Bash League franchises. The administrative body intends to sell 49 per cent of what could eventually be 10 franchises in the domestic Twenty20 competition, according to The Australian.
A new collection of eight canine genomics papers, published this week have found that nearly two-thirds of modern dog breeds, including even Chihuahuas, contain traces of wolf DNA.
Fear-o-meter
There is a growing amount of evidence that the local economy is firing up. In the past 24 hours, there were business investment figures that were the strongest in four years, and APRA, the prudential regulator, warned of growing risk taking in the housing market.
Earlier this week, the October inflation figures were well above expectations, triggering a winding back of any interest rate cut expectations. Last week, ABS data showed that the unemployment level fell from 4.5 per cent to 4.3 per cent in October.
In equities, several retailers, notably Harvey Norman, have outlined strong sales for the first quarter of this financial year. A caveat: not all retailers have done that, and this week’s Black Friday, Cyber Monday sales are critical.
The bottom line is that the economy is heating up, and inflation is once again a concern. Any hopes of another rate cut have been doused, and the next move might be up, not down.
Fear & Greed Q+A today
Answering a listener's question about CSL, explaining what's behind the recent share price slump, and the outlook for the healthcare giant:
"There are conspiracy theories everywhere on this stock at the moment, which is kind of like the darkest before dawn type scenario, which I think we're in. But what do we need to see for the stock to actually rerate from here? We need to see it in the numbers. No one will believe it now until it's in the numbers. And unfortunately, first half 26 which we will see in February is not the half that's going to placate everybody."
Kevin Rudd and Bob Hawke were the most popular modern leaders to go to an election, according to new analysis by Nine newspapers. The report looked at how recent leaders were rated (0 being strongly disliked, and 10 being strongly liked) when they went to the polls. For brevity we've kept this table to just their most popular rating - some, like John Howard, led their parties at multiple elections, so appear many times.
