It’s Thursday, the 28th of August. Inflation surged to 2.8% in July – the highest annual rate since this time last year – fuelled by rising housing costs, and the end of state energy rebates. The increase has dented hopes of back-to-back interest rate cuts, with markets instead pricing in a cut in November. But Treasurer Jim Chalmers hosed down concerns, flagging that the jump was partly driven by volatile, one-off factors, and urging caution in interpreting monthly figures.
CSL chair Brian McNamee has blamed Victoria’s entrenched work-from-home culture for research and development failures at the biotech giant’s Melbourne labs, saying there is “something fundamentally wrong” with operations in the state. Meanwhile, the federal government has rejected a Greens push to legislate a national right to work from home.
Woolworths chief Amanda Bardwell has refused to be drawn on speculation the group is readying to spin off struggling Big W, after Australia’s biggest supermarket chain reported a 17pc plunge in full-year profits. Shares dropped 15pc yesterday.
Domino’s Pizza will scrap discounts and vouchers in favour of a Bunnings-style 'everyday low prices' model, as the chain seeks to reverse sliding sales that led to its first annual loss in two decades.
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Fear-o-meter
My Bui from the AMP economics team analyses yesterday's monthly inflation figures, and what they mean for interest rates.
The monthly consumer price index (CPI) indicator rose by 2.8% over the year to July, much higher than June’s indicator at 1.9% as well as the consensus forecast for a 2.3% rise. This month’s upside surprises were particularly from holiday travel, consumer durables, and a larger than expected increase in electricity prices following the phasing out of rebates.
One significant factor contributing to [the] substantial upside surprise was the specific composition of this month's indicator (similar to the upside surprise in April). The July report only measures about 2/3 of the items in the basket and features many goods rather than services items, which are inherently a bit more volatile and harder to forecast because they are not as “sticky” as dining out, hairdressing, household services, or insurance. But [this] report clearly shows that the downtrend in goods inflation over the past two years has run out; and the next leg in inflation would depend on services momentum (which is still in a very gradual downtrend).
The inflation data presents a small upside risk to our trimmed mean inflation forecast of 2.6% year-on-year for the September quarter. However, given that the CPI indicator is a very noisy report that has given false signals before, we continue to see our rate cut forecast unchanged – we see cuts in November this year as well as February and May next year, after the RBA receives the full quarterly inflation report.
Fear & Greed Q+A today
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Why stablecoins might be the future of payments:
"If you were to design money today to operate on the internet, you would design it as a stablecoin. It's a decentralised ledger. It is a token-based system, and it is entirely digital.
And what's really interesting is it unlocks all these opportunities that are really hard to solve with traditional fiat currency. If we look at global money movement, at the moment, banking rails are quite legacy and there's a lot of innovation over the top of that in order to [improve] that complexity and that slowness in transactions. But with stablecoins, essentially money can move as fast as bits can move around the internet. And so you have this ability to unlock entirely new use cases.
One of the really interesting use cases that we see is unlocking markets that have been traditionally really, really hard to get access to."
Internet advertising market is booming, increasing 10.6% year on year to reach $17.2bn for FY25. Search maintains the largest share of online advertising at 44%, but video advertising has been the growth engine for the market and now represents 29% of all spend.
