Latest news with #AustralianDollar
Yahoo
2 days ago
- Business
- Yahoo
Economist's jumbo $128 RBA interest rate prediction in weeks: 'No need to wait'
A top economist has called on the Reserve Bank of Australia (RBA) to deliver a jumbo cash rate cut in July. Economic growth has been weak, and Australian consumers are continuing to be 'cautious' with their spending, leading to an "agonisingly gradual recovery" in the private sector economy. EQ managing director Warren Hogan has called on the central bank to 'act decisively' at its next meeting and make an 'uncharacteristic' 35 basis point rate cut. This is bigger than the standard 25 basis point cut mortgage holders received in February and May. 'At this stage, the RBA seems to think a neutral cash rate is about 3.5 per cent. There is no reason to wait,' Hogan, who has previously been a cautious voice about rate relief, wrote in an opinion piece for the Australian Financial Review. RELATED Australian dollar rebounds in 'unusual' sign for RBA ahead of interest rates decision Major Coles move to take on Chemist Warehouse, Bunnings, Amazon Centrelink payment change happening next week: 'Will increase' A 35 basis point cut would lower repayments on the average $600,000 home loan with 25 years remaining by $128 per month. That would be a saving of an extra $37 a month, compared to a standard 25 basis point cut. Economist and Yahoo Finance contributor Stephen Koukoulas has also called for a supersized interest rate cut at the RBA's next meeting. He said the RBA needs to "aggressively" move the cash rate to a neutral, or accommodative, position. 'We do need to see the RBA cutting 50 [basis points] at the July meeting, playing a bit of catch up for its errors previously, getting the cash rate down to 3.35 per cent and giving the economy a chance to get a breather, to grow a bit,' he said. A neutral rate is one that is neither stimulatory nor contractionary. There is no set definition for what it is, but it is thought to be in the low 3 per cent region. The Australian economy grew just 0.2 per cent in the March quarter and 1.3 per cent in annual terms. Koukoulas warned that the longer it takes to get the cash rate to a neutral level, the 'worse the economy will be'. 'It needs to get there sooner rather than later, otherwise 2026 is going to be a really tough year for the economy,' he said. Hogan said that despite a boost to real disposable incomes, Australian consumers were 'unwilling to loosen the purse strings in a meaningful way', preferring to save rather than spend their extra income. "The household saving ratio jumped above 5 per cent, back to what was normal prior to the pandemic. It could go higher, particularly as the government seeks to tax superannuation incomes at a higher rate in the future," he said. Businesses are also slowing the pace of capital deployment and experiencing a squeeze on profits from cost growth, but are unable to pass this on to customers. 'Either businesses start passing on costs, and we get higher inflation, or business profits continue to be squeezed, and profits soon contract,' Hogan warned. 'Business will retrench their investment plans; many businesses will fail. This risks an entrenched stagnation, hauntingly similar to Japan's economy of the 21st century.' Financial markets expect the RBA will deliver another three 25 basis point cuts to the cash rate in 2025, taking it to 3.10 per cent by the end of the in retrieving data Sign in to access your portfolio Error in retrieving data
India.com
3 days ago
- Business
- India.com
World's only country without a capital, it is spread over an area of..., the name is..., located in...
(Image: New Delhi: There are many countries in the world which are famous for their different specialties. Some countries are known for low population, while some countries are covered in snow. Some countries are very developed, while some countries are famous for strange things. Every country has its own rules and laws, which are followed by the common citizens there. Also, the government there provides the best facilities to its people, so that they do not face any kind of problem. Here income is generated from agriculture, technology, development, tourism, business etc. due to which the country gets all kinds of help. Today we are going to tell you about a country which has no capital. Usually, any state or country has a capital from where all kinds of administrative works are done. The important government offices of that country or state are also run in its capital. But there is a country which has no capital and a vast majority of people across the world don't know about it. Fret not because we will tell you the name of that country. The name of this country is Nauru. It is an archipelago made of a group of small and big islands located in the Micronesia South Pacific Ocean, which is also known as Nauru. This country spreads over 21 square kilometres and is the only republican country in the world which has not had any capital till now. According to historians, 12 tribes used to rule here traditionally, the effect of which is also visible on the country's flag. The main source of income for the people here is forest mining. However, now the people here make a living by producing coconut. The population here is very less. Despite this, Nauru participates in the Olympics and Commonwealth Games. The national currency of this country is the Australian Dollar and the main city is Yaren. Nauru has some of the most beautiful coral reefs and white sand beaches which attract a lot of tourists.
News.com.au
5 days ago
- Business
- News.com.au
‘Uncertain macro backdrop': ASX slips ahead of jobs figures
Cautious investors sold down the ASX on a quiet day of trading on Friday, despite the US and China resuming trade talks, as markets await critical jobs data out of the US. The benchmark ASX 200 index slipped for the second consecutive day of trading falling by 23.20 points or 0.27 per cent to 8,515.70. The ASX200 has now recorded four consecutive weekly gains. The broader All Ordinaries fell during Friday's trading, down 26.70 points or 0.30 power cent to 8,741.90. The Australian dollar also is down 0.21 per cent and is now buying 64.95 US cents. On an overall bleak day on the market, nine of the 11 sectors finished in the red with just energy, industrials and utilities gaining ground. Woodside Energy gained 0.97 per cent to $22.94, while Santos is up 0.61 per cent to $6.58 as the price of Brent crude oil continues to recover over the week's trading. Industrials also had a strong day led by Qantas Airways which jumped 3.46 per cent to $10.76 despite the news Virgin Australia is looking to re-list. Transurban shares also rose 0.63 per cent to $14.38, and Computershares Limited rose 0.83 per cent to $41.08. CBA shares slipped from its record highs down 0.79 per cent to $179.90, Westpac fell 0.24 per cent to $33.18 and ANZ traded 0.44 per cent lower to $29.50. NAB was the only big four bank to finish in the eking out a 0.18 per cent gain and to close Friday's trading at $38.58. eToro market analyst Josh Gilbert said initially there was optimism on the markets following 'very good' trade talks between Washington and Beijing. But this quickly changed after a public spat between former friends President Donald Trump and Tesla chief executive Elon Musk. 'This will provide a hit to overall market sentiment, particularly tech, but may not be long-lasting for anyone other than Tesla,' Mr Gilbert said. The overall lower volumes on the ASX comes as investors await the latest payroll data out of the US. 'The uncertain macro backdrop continues to provide a hurdle for risk-on sentiment, and cooling US economic data is leaving investors unassured,' Mr Gilbert said. 'With the labour market heavily in focus, the print this evening will be essential for market direction.' Mr Gilbert said negative economic data released throughout the week could actually help drive the ASX 200 higher. 'The weaker-than-expected GDP data this week also drives the expectation for further rate cuts, further supporting the market optimism,' he said. In corporate news, Worley shares fell 0.46 per cent to $13.08 despite the business announcing it had won a contract with Glenfarne to help support engineering work on its Alaska LNG pipeline. Shares in gold miner West Cobar Metals soared 60 per cent to $0.024 after announcing it has completed the acquisition of the Mystique Gold Project in Fraser Range, Western Australia.
ABC News
6 days ago
- Business
- ABC News
Live updates: Aussie dollar rises above 65 US cents as RBA rate cut predicted for July
Australia's currency rose above 65 US cents overnight as weak GDP figures pushed up the chances of a RBA rate cut in July. Meanwhile, new figures show mining exploration investment in Australia is at its lowest level in years. Follow the day's financial news and insights from our specialist business reporters on our live blog. Disclaimer: this blog is not intended as investment advice.
News.com.au
03-06-2025
- Business
- News.com.au
‘Unusual' thing happening to the Aussie dollar in wake of Trump tariffs, says Reserve Bank
The global uncertainty sparked by US President Donald Trump's tariff agenda has resulted in something unusual happening to the Australian dollar. RBA assistant governor Sarah Hunter noted on Tuesday that the Aussie dollar has been behaving differently against the greenback than what we would historically expect. 'When the outlook for global growth weakens, the Australian dollar typically depreciates,' she explained in a speech at the Economic Society of Australia Business Lunch in Brisbane. This is because investors expect the Australian economy 'to be buffeted by the global headwinds and the RBA to respond with cuts to the cash rate'. The fact that the Australian dollar is a 'risk-sensitive' currency also contributes to the depreciation as 'when global investors are worried, they tend to focus on reducing risk exposure, moving their capital to low-risk assets in countries like the United States, Switzerland and Japan.' 'This means the Australian dollar tends to lose value against these currencies,' she said. When Trump announced his global 'Liberation Day' tariffs the Aussie dollar did as expected and fell, plummeting to below 60 US cents for the first time since the pandemic. However in recent weeks, the Aussie has recovered against the greenback and has been sitting between 64 and 65 US cents which, according to Dr Hunter, is 'more unusual' in a continuing time of uncertainty. Dr Hunter said this is in part due to a broad weakness in the USD after some global investors reduced their exposure to US assets. 'The weakness in the US dollar during a period of heightened risk is in contrast with many previous episodes,' she said, 'though it's too early to know whether this dynamic will continue.'
