Latest news with #AustralianDollar
Bloomberg
3 days ago
- Business
- Bloomberg
Hedging by Australia's Pension Funds Set to Boost Local Dollar
The Australian dollar is set for further gains as the nation's biggest pension funds have reason to boost hedging of their US assets to shield them from policy uncertainties. Tariff risks and bets that the Federal Reserve will cut interest rates should weaken the greenback, according to Ray Attrill, head of foreign-exchange strategy at National Australian Bank in Sydney. Aussie pension funds may then have to increase currency hedging for their US assets, he said.
News.com.au
17-07-2025
- Business
- News.com.au
Employment rises by 2,000 but jobless rate jumps, sending Aussie dollar plunging
The Australian dollar has slumped and the money markets are calling a 100 per cent chance of a rate cut after new data revealed a shock fall in the employment rate. The unemployment rate rose to 4.3 per cent last month, beating market expectations of 4.1 per cent, according to the Australian Bureau of Statistics. Employment as a whole rose by 2000 people this month, following a fall of 1000 in May, and is up 2 per cent year on year. The rise in unemployment was determined as 33,600 workers became unemployed in June. This was against expectations of 20,000 jobs to be added in the month and the unemployment rate to hold. Markets immediately jumped on the news, with investors now banking on a future rate cut. With expectations of lower rates, the Australian dollar slumped back below 65 US cents, while Australia's sharemarket jumped on the news. IG market analyst Tony Sycamore said the bond market was quick to react to Thursday's data, moving up expectations of a rate cut from 80 to 100 per cent in August. 'Today's rise in the unemployment rate pushes it above the RBA's forecast of 4.2 per cent for June 2025 and meets the 4.3 per cent rate the RBA expected by year-end,' he said. 'Combined with last month's fall in employment, there are clear signs of deceleration emerging in the labour market. 'This calls into question the RBA's decision to prioritise inflation over growth and jobs at its board meeting earlier this month. Betashare chief economist David Bassanese, who called a hold in July, said Thursday's unemployment data was a 'slam dunk' for an August rate cut. 'We'll need more consistent signs of weakness in both employment and hiring indicators before we can conclude the labour market is turning,' he wrote in an economic note. 'That said, today's result clearly adds to the case for a RBA rate cut at the August policy meeting provided next week's Q2 CPI report is not a shocker.' With the unemployment rate lurching higher, growth at subpar levels, and inflation back within the RBA's target band, the RBA will no doubt be keen to make amends at its meeting in August. The underemployment rate also increased to 6 per cent, as 40,200 part-time roles were created and 38,200 full-time roles were lost from the job market. The employment-to-population ratio remained at 64.2 per cent, and the participation rate, being people who are actively working, rose to 67.1 per cent. Hours worked fell 0.9 per cent in June, following a rise of 1.4 per cent in May. ABS head of labour statistics Sean Crick said: 'This month we saw a decrease in full-time hours worked, down 1.3 per cent, associated with a 0.4 per cent fall in full-time employees.' Prior to Thursday's figures, experts had tipped the unemployment rate to remain at 4.1 per cent, although they did predict a tightening of the jobs market. The Reserve Bank of Australia will be watching the jobless rate ahead of its next meeting, having the dual mandate of employment and controlling inflation. 'I think the focus for the RBA will be ensuring the labour market remains healthy going forward,' NAB's head of Australian economics Gareth Spence said. 'The timing of cuts is not super important. 'It's more about where do they end up.' In a move that shocked markets and disappointed homeowners, the RBA kept the official cash rate at 3.85 per cent during its July 8 meeting.
Daily Mail
10-07-2025
- Business
- Daily Mail
Australia a step closer to digital currency: what you need to know
The Reserve Bank of Australia is moving towards fashioning a new digital version of the Australian dollar. The RBA is moving to the trial phase by getting partners to try out digital coins in a development called Project Acacia. It's a joint initiative between the RBA and the Digital Finance Co-operative Research Centre (DFCRC) and phase one in August was a success. The second phase will be completed in the first quarter of 2026. Three of the big four banks and others will test stablecoins, bank deposit tokens and pilot wholesale central bank digital currency (CBDC). They will also look at new ways of using banks' existing exchange bank accounts at the RBA. RBA assistant governor Brad Jones said the scheme was a priority in the digital age. 'The use cases selected in this project will help us to better understand how innovations in central bank and private digital money, alongside payments infrastructure, might help to uplift the functioning of wholesale financial markets in Australia,' he said. During the trials, other third parties, Hedera, Redbelly, R3 Corda and Canvas Connect, will test the central bank digital currency. The bank is looking for 24 innovative use cases, including 19 pilot cases, which will involve real money and real asset transfers. It will also include five proof-of-concept use cases with simulated transactions. ASIC commissioner Kate O'Rourke said it was a good sign of a lively economy and society. 'ASIC sees useful applications for the technologies underlying digital assets in wholesale markets,' she said. 'The relief from regulatory requirements that we have announced will allow these technologies to be sensibly tested – to explore opportunities and identify and tackle risks.' ASIC has given the project regulatory relief to permit members to transact using the digital Australian dollar. 'Importantly, Project Acacia will allow industry and regulators to work together to learn more about how these use cases may reshape the financial services industry, potentially boosting efficiency and foster economic growth,' Ms O'Rourke said. RBA governor Michele Bullock has said in the past however that she didn't believe in different payment solutions like bitcoin during a parliamentary inquiry in February. 'It doesn't have a solid value. You can't be guaranteed that what it's worth today it will be worth the same thing tomorrow,' she said. 'It's extremely slow relative to other payment systems (that) you can get transactions through in milliseconds.' Ms Bullock did point out however that her opinion did differ from the RBA. DFCRC chief scientist Talis Putnins said the alliance from many parts of the industry was a positive. 'The real money settlement models being tested, including issuing pilot wholesale CBDC on third-party platforms, reflects another world-first for Australia in this rapidly evolving field,' Professor Putnins said.
ABC News
09-07-2025
- Business
- ABC News
Markets live updates: Nvidia climbs past $US4 trillion and ASX to follow Wall Street higher
Wall Street has climbed and chipmaker Nvidia has hit a milestone as the first public company to reach a $US4 trillion (more than $6 trillion) valuation. The local share market is eyeing gains at the open, while the Australian dollar is buying about 65.3 US cents. 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
09-07-2025
- Business
- News.com.au
Pharmaceuticals, copper miners fall on ASX after latest Trump move
Australia's sharemarket fell during Wednesday's trading as US President Donald Trump's tariff policy hits two key market sectors. The benchmark ASX 200 index slumped 52.10 points or 0.61 per cent to close Wednesday's trading at 8,538.60. The broader All Ordinaries also slipped 50.80 points 0.58 per cent and finished trading at 8,777.80. The Australian dollar bounced from Tuesday's fall and is now buying 65.43 US cents. On a day with low trading volumes, seven of the 11 sectors finished lower with the falls led by property, miners and consumer staples stocks. Local investors reacted to President Trump ramping up his tariff policies, with copper likely to get a 50 per cent tariff and pharmaceuticals facing a 200 per cent tax on imported goods. While pharmaceuticals will likely face large tariffs, Mr Trump said he could give foreign made products a year to a year and a half to set up manufacturing in the US. Copper futures slumped 2.4 per cent and Australia's copper miners sold off, even though the US is not a major buyer from Australia of the commodity. Australian investors on the local bourse responded by selling down the miners with Sandfire Resources which dropped 3.45 per cent to $11.18 and Capstone Copper, slumping 3.03 per cent to $9.28. Evolution Mining, which is both a gold and copper player, sank 7.02 per cent to $7.29. The more diversified miners fared better, with BHP falling 1.02 per cent to $37.85 and Rio Tinto giving up 0.55 per cent to $107.59. Healthcare shares were mixed with CSL sliding 0.91 per cent to $243.71, while ResMed dropped 0.25 per cent to $39.24. Pro Medicus and Cochlear were both higher up 0.15 and 0.52 per cent respectively. The big four banks also had a mixed day. Shares in CBA fell 0.21 per cent to $178.90 and ANZ shares slipped 0.50 per cent to $30.06. On the other hand NAB shares eked out a small gain up 0.03 per cent to $39.30 and Westpac finished in the green up 0.69 per cent to $33.70. AMP chief economist and head of investment strategy Shane Oliver said the markets reacted to mixed messages on tariffs. 'While the further pause to 1st August is welcome, it looks like we are on the way back up again with the tariff rates likely to be around 20 per cent,' he said. 'Where it ultimately settles is hard to know. 'On the one hand, Trump is being emboldened by the resilience of US growth, still low inflation and record highs for shares, so it's not a bad time for him to throw another tariff tantrum.' In company news shares in Telix Pharmaceuticals were among the major winners after the company announced its Gozellix imaging agent for prostate cancer has been added to a US patient reimbursement scheme. Telix shares jumped 5.62 per cent to $25.39 following the announcement. Shares in Lifestyle Communities were hammered plunging 37.22 per cent to $4.42 after a VCAT ruling found its deferment management and exit fees were invalid under state tenancy laws. Bega Cheese shares also fell 1.51 per cent to $5.21 after announcing its peanut processing plants in Kingaroy and Tolga will be closed.
