Latest news with #BusinessNow
Sky News AU
4 hours ago
- Business
- Sky News AU
InTouch Capital's Sean Callow forecasts ‘most likely' scenario for Aussie dollar as Donald Trump eyes higher tariffs
A leading economist has outlined the 'most likely' scenario for the Australian dollar as Donald Trump continues to wage his trade war. Australians were rattled after the US President revealed his baseline tariffs would be either 15 or 20 per cent – higher than the initial 10 per cent he announced on 'Liberation Day' in April. Despite Trump's claim, Trade Minister Don Farrell said the Albanese government is still assuming 10 per cent tariffs until otherwise advised by the Trump Administration. InTouch Capital foreign exchange analyst Sean Callow said it was 'very difficult to pin down' how the looming tariff decision would play out. 'How does China respond? Can they produce the stimulus that would offset some of the impact of these higher tariffs that are still in place with the U.S?' Mr Callow said on Business Now. He remained upbeat about the future of the Australian dollar despite the uncertainty from Trump's tariffs. 'It's certainly a more positive mood," Mr Callow said. 'Those rallies in global equities are usually supportive for the Aussie dollar, it does tend to correlate positively with that. 'So the uptrend in the Aussie (dollar) is still probably the most likely path over the next few months.' The Aussie dollar dipped from 63 US cents to about 60 US cents after Trump revealed his sweeping tariffs in April. It quickly recovered its losses and has added another two cents in recent months. Mr Callow forecasted the dollar to surge later in the year after it nudged up on Tuesday. 'It might continue to struggle a little bit around that 66 cent area,' he said. 'I do see the case for it to rally later in the year, but it poked its head above 66 cents and then the U.S dollar has just found a little bit of support in recent days. 'It's on a firmer footing in the past few weeks than it has been for a while.' Trump on Monday (US time) told reporters he could hike the baseline tariff from 10 per cent to either 15 or 20 per cent. 'We're going to be setting a tariff for, essentially, the rest of the world,' the US President said. 'That's what they're going to pay if they want to do business in the United States, because you can't sit down and make 200 deals.' Asked how steep the new tariff could be, Mr Trump replied: 'I would say it'll be somewhere in the 15 to 20 per cent range. I just want to be nice,' he added.
Sky News AU
a day ago
- Business
- Sky News AU
Major overhaul underway that means the Reserve Bank of Australia could deliver rate cuts sooner
Aussies could be delivered quicker rate cuts as detailed data critical for the Reserve Bank of Australia will be published at a higher frequency. The Australian Bureau of Statistics from November 26 will begin publishing a full monthly consumer price index – which measures household inflation. Currently, the ABS only publishes a monthly CPI indicator which examines about two thirds of the goods and services in the quarterly inflation figures. A frequent full CPI would allow the RBA to make more informed cash rate calls - which was a sticking point for the central bank when it controversially held rates earlier this month. RBA governor Michele Bullock said the decision mainly came down to timing as the central bank awaited more details about how inflation was continuing to ease. "By our next meeting in five weeks, we will have the June quarter consumer price index, another labour market reading, further information about international developments and an updated set of forecasts," Ms Bullock said. "So the Board decided to wait a few weeks to confirm that we're still on track to meet our inflation and employment objectives." ABS statistician David Gruen said the bureau began publishing the monthly CPI indicator in 2022 when inflation was rapidly accelerating. 'We thought that there was benefit in providing more up-to-date information,' Mr Gruen said on Business Now. 'At the time, we were only in a position to produce this indicator which updates about two-thirds of the basket of goods and services every month. 'After we'd been producing that for some time, we pitched to the government the idea that we could create a full monthly CPI, that means updating the full basket.' All other G20 countries publish a full monthly CPI and the change will make it easier to compare Australia's inflation to nations with similar economies. Both trimmed mean inflation – the middle 70 per cent of price changes core to the RBA's call – and headline inflation now sit within the central bank's target band. The ABS will release a full CPI for the June quarter on Wednesday where it is expected that trimmed mean inflation will fall from 2.9 per cent to 2.7 per cent. Every major bank predicts the RBA will cut rates when it next meets in August.
Sky News AU
3 days ago
- Business
- Sky News AU
South Australia Premier Peter Malinauskas unveils bold vision for economic growth amid global shifts
Premier Peter Malinauskas says South Australia is positioning itself at the forefront of global copper and uranium demand, while also actively reshaping its economic landscape to become a magnet for private investment and industrial innovation. Speaking on Business Now, the Premier identified copper as one of the most critical minerals of the future and declared that the state is preparing to capitalise on a global supply shortfall. 'Seventy per cent is the figure that we expect copper demand to grow over the course of the next 25 years and even if all of the copper mining projects globally were to reach FID, we still don't get to that number,' he said. 'So Olympic Dam has a major opportunity before it, provided we can make sure that the economics stack up and certainly my government's working closely with BHP in that regard.' Malinauskas acknowledged the risks posed by global economic disruption and protectionist policies - including recent US tariff moves - but remained confident that South Australia's approach will unlock long-term opportunities. 'Having said all that, we don't believe it represents a major material risk to this expansion simply because BHP, in conjunction with my government, are actively exploring it on the basis of massive growth in demand of copper globally but also uranium as the world continues to produce more nuclear power which is an important resource as well at Olympic Dam.' Central to the copper and uranium play is government-backed infrastructure investment. The Premier highlighted the strategic importance of a proposed desalination plant and water pipeline, which could benefit Olympic Dam and unlock broader economic potential across the region. 'We can't take a hands-off attitude, and we're very conscious of the fact that the provision of water to Olympic Dam is absolutely critical to unlock this opportunity,' he said. 'There might be other opportunities that emerge as a result of a desal plant and a pipeline of the nature that we're working on.' In an environment of fierce global competition for capital, Malinauskas emphasised the role of fast approvals, low taxation, and regulatory stability in making South Australia a standout destination for investment. 'To the extent that the approvals are reliant upon state government, and there are a lot of them that are, we have established an expedited process. We're working really hard in South Australia, not just in respect of the speed of approvals, but making sure that our taxing regime is low and it is the lowest in the country," he said. 'The Business Council of Australia have listed South Australia as the number one jurisdiction in the nation to do business and we've worked hard to achieve that.' But the Premier's ambitions stretch beyond mining and minerals. As part of a broader strategy to reboot South Australia's industrial base, the Whyalla steelworks - long viewed as an economic challenge - is receiving renewed focus, with a combined $275 million injection from state and federal governments. 'That's the challenge before us, and I don't think it's going to be an easy task. But the opportunity is before us by virtue of where the steel works is located.' Malinauskas said the combination of magnetite ore, gas reserves, and port access created a compelling case for sustainable steelmaking. 'MacIntyre lends itself to a decarbonised version of steel making, which may make it, or even green iron, which of course is an export industry that a number of steel producing countries would be very interested in. 'We see that a decarbonisation path requires an increase in supply of natural gas at an economic price. I think that is a unique opportunity if we can get the right owner of the steel works.' With four consecutive budget surpluses under his belt, Malinauskas also pointed to South Australia's financial stewardship as a foundation for economic expansion. 'We've just recently delivered our fourth budget, and it contains our fourth surplus. What we've been able to do is grow our state's economy at a pace that we were not really accustomed to in the past. And that growth has negated our need to actually make changes to the tax base,' he admitted. The Premier also called for a national rethink on research and development, warning that without investment in intellectual property and innovation, Australia risks falling behind globally. 'Our R&D base in Australia is very low in comparison to other OECD countries,' he said. 'In order to move up the value chain and become increasingly competitive, we need to be deploying technologies and intellectual property that we generate here in Australia.'
Sky News AU
6 days ago
- Business
- Sky News AU
Labor needs to 'turn the ship around' in second term, AI Group's Innes Willox declares ahead of economic roundtable
Labor needs to 'turn the ship around' through its upcoming economic roundtable where the Albanese government's goals to boost productivity and investment in Australia will take centre stage. Australia's ailing productivity will be the subject of the roundtable led by Treasurer Jim Chalmers next month where leaders across business, politics and unions will discuss the nation's poor growth. AI Group chief executive Innes Willox is one of the attendees and urged the Albanese government, which has returned to parliament with a massive majority, to develop a clear picture of how to drive the nation's economy forward at the roundtable. 'This is an opportunity for the government to … get clear understandings around the big challenges that we face around productivity and investment and all the things that go into that,' Mr Willox told Sky News' Business Now. 'This is sort of like a legacy moment, a watershed moment. Not only for the government but also for the country because we have one chance here to turn the ship around and start to get things heading in the right direction.' Mr Willox was hopeful of genuine change from the Albanese government as he said there had been an 'epiphany' from some Labor members about the nation's economic future. He said it came from a novel by two US journalists titled 'Abundance' that had become popular in Canberra. The shift, Mr Willox said, was a "recognition" that "governments have indulged in process over outcomes, dollars over delivery and complexity over certainty". 'We need to turn all of that around so that we get government focused on the things that matter," Mr Willox said. 'Government in many ways, whether business likes it or not, is a partner of business, but it's a partner that has to act in the interests of business as well. 'If they don't, we're just going to continue to see a decline in living standards.' Economic and productivity reform was a lower priority during the Albanese government's first term, despite slow growth and the country sitting in a per capita recession. Labor struggled with sky-high post-pandemic inflation during its first term - which ate into household budgets. Inflation rose more than 17 per cent over about three and a half years while wages fell behind, prompting Labor to introduce an array of cost of living assistance measures such as energy bill relief. Labor will look towards fostering long term economic prosperity at the productivity roundtable from August 19 to 21. Here, the government said it will strive to "enhance economic resilience and strengthen budget sustainability".
Sky News AU
18-07-2025
- Business
- Sky News AU
RBA 'made a mistake' with shock interest rate hold, KPMG's Brendan Rynne declares after unemployment rate rises in June
A leading economist has torn into the Reserve Bank of Australia's recent decision to hold the cash rate after it was revealed the unemployment rate rose in June. Fresh data from the Australian Bureau of Statistics showed the unemployment rate rose 0.2 per cent to 4.3 per cent after it sat near historic lows following the pandemic. The unemployment rate is a critical piece of data for the RBA's cash rate decision, and a rise would typically mean the central bank would lower rates. After the central bank held the cash rate at 3.85 per cent, despite money markets overwhelmingly factoring in a 0.25 per cent cut, many lashed out over the shock decision. The fresh jobs data led to heightened backlash, with KPMG's chief economist Brendan Rynne joining the chorus during an appearance on Sky News Business Now. "I think they made a mistake in keeping the cash rate at 3.85 per cent," Mr Rynne said. "The risk associated with dropping that cash rate down - in terms of getting an inflation bounce compared to providing some support into the private side of the economy - we think that risk trade-off is one that should have been associated with the dropping the cash rate down to 3.6 per cent. "In the next meeting, we know that the Reserve Bank was saying it's not a matter of if rates are going to drop, it's just going to be a matter when rates drop. "We fully expect now that 25 basis points to come off at the next meetings." After holding the rate earlier this month, RBA governor Michele Bullock said the decision was due to "timing" as it awaited further data on inflation. 'The board decided to wait a few weeks to confirm that we're still on track to meet our inflation and employment objectives," she told reporters after the decision. Mr Rynne predicted annual trimmed mean inflation - the middle 70 per cent of price changes core to the RBA's decision - would come in a 2.5 per cent for the June quarter, which is in the RBA's target band. He did forecast headline inflation - which examines everything in the ABS' consumer price index - will shift as government rebates phase out. "Headline inflation will bounce over the remainder of this year, coming back up a little as the full effect of the electricity rebates and cost of living rebates start to roll off," "Notwithstanding those, we do think that that inflation is still pretty weak, particularly goods inflation, and it's going to be that further rolling off of services inflation that's going bring it down in total." If the RBA had cut rates in July, it would have been the first consecutive rate cut since the central bank delivered an emergency cut in 2020 during the onset of the pandemic. Every major bank forecasted a 25 basis point cut in July while money markets at one pointed priced in a 99 per cent chance of a cut. If the RBA is to cut rates in August, it will be the third rate cut this year and will bring the cash rate down to 3.6 per cent.
