US President Donald Trump said the US and Iran will sign a deal to extend the current ceasefire in place in the Middle east, and re-open the Strait of Hormuz, as early as this morning, Australian time. The President said as soon as the deal was signed, the Strait would be open to all.
We have been at the brink of a deal before, only to be disappointed. But this time Pakistani prime minister Shehbaz Sharif, the key go-between for the two sides, said an “electronic signing” of a memorandum of understanding was expected within 24 hours.
Iran’s foreign ministry said the timing of the signing was unclear, though it did suggest a signing was likely.
On the week ahead for the economy, including the RBA meeting, and whether the next move in rates will be down:
“I think there's enough evidence to say that if they're not going to hike, what that means next is down probably - but well into the future.
Before they pull the trigger on a rate cut, they need to see that inflation rate rapidly returning to the midpoint of their target band, so two-and-a-half percent for annual inflation. We're not there yet.
And probably to reinforce that rate cut, if and when it comes, they need the unemployment rate to be materially higher than four-and-a-half percent. Up towards certainly five percent would do it, but even the high fours — 4.7, 4.8, 4.9. If the inflation rate is coming down rapidly, yeah, that's the scenario for a rate cut.”
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News in brief
A growing number of market economists believe interest rates are on hold, and the next move may well be down, ahead of tomorrow’s interest rate decision from the Reserve Bank.
The preliminary auction clearance rate across the country over the past week rose to 54 per cent but still remains well below the average rate over the past year. The final clearance rate is likely to be well below 50 per cent.
Qantas is in talks to replace its biggest aircraft, the Airbus A380, and accelerate plans to fly to more long-haul destinations without stopping.
Holiday makers are swapping Europe for Bali, with the Middle east conflict triggering a surge in trips to Indonesia and Vietnam.
SpaceX listed on Wall Street on Saturday morning, Australian time, with shares ending up 19 per cent, meaning the value of the rocket, AI and social media company pushed to $US2.1 trillion, and Elon Musk’s wealth hit $US1.1 trillion.
Fear-o-meter
Newsletter Morning Brew on Elon Musk’s wealth
You can’t even compare Musk’s wealth to other rich people. The founders of Google, Amazon, Oracle, and Meta combined have about $1.3 trillion. Musk is now on par with the economies of entire countries: only 21 countries have GDPs over $1 trillion.
If your household brings in $84,000 a year (the US median income for 2024), it would take you 12 million years to make a trillion dollars, according to NBC.
For a physical representation: if you painstakingly laid out one trillion single dollar bills end to end, it would stretch the distance of 200 round trips to the moon. With $1 trillion dollars, you could give everyone in the world (about 8.2 billion people) $122. Or you could buy:
Every piece of property in Houston for $879 billion;
243 billion gallons of gas at $4.11 a gallon. For context, Americans only bought 137 billion gallons of gas last year;
Every carmaker in the US (excluding Tesla), Europe, and Japan…and still have $100 billion leftover.
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