Latest news with #businessConfidence
Reuters
3 days ago
- Business
- Reuters
Australia central bank pondered outsized rate cut in May, decided to be predictable
SYDNEY, June 3 (Reuters) - Australia's central bank considered cutting interest rates by an outsized 50 basis points last month as "insurance" against global trade risks, but decided to go the predictable route with a cautious easing. Minutes of its May 20 policy meeting, showed the Reserve Bank of Australia board also debated holding rates unchanged at 4.10%, but saw strong arguments both domestically and globally for a move to 3.85%. Crucially, President Donald Trump's tariffs had been much higher than first assumed and posed significants risks to global growth, and thus to Australian business and consumer confidence. Indeed, if the worst scenarios eventuated policy might need to move to "an expansionary setting", implying rates falling below a neutral range around 3.0%. However, board members were not persuaded that a cut of 50 basis points was needed at this meeting given the domestic economy was still resilient and the labour market still tight. The board also noted it would be challenging for businesses and households should the RBA, for whatever reason, have to reverse such a rapid easing. "They also judged that it was not yet time to move monetary policy to an expansionary stance," the minutes showed. "Globsal policy uncertainty led members to express a preference to move cautiously and predictably when withdrawing some of the current policy restriction." Markets imply around a 70% chance the RBA will ease again at its next meeting on July 8, though most analysts assume it will wait for inflation data for the second-quarter to be released later in the month before deciding in August. Futures see rates bottoming around 2.85% or 3.10% by early next year, roughly where policy would be neutral as in neither stimulating nor restraining economic growth. The minutes showed the board udged progress on domestic inflation alone would have allowed for a cut in rates, and global uncertainty merely strengthened the case. Core inflation ran at an annual 2.9% in the first quarter, back within the RBA's 2% to 3% target range, and is projected by policy makers to reach 2.6% by year-end. The board also saw a risk that household consumption might not pick up as expected, having been surprisingly subdued in rec ent months despite the RBA cutting rates for the first time in February. (Reporting by Wayne Cole) Keywords: AUSTRALIA RBA/MINUTES
RNZ News
30-05-2025
- Business
- RNZ News
High food prices, 'tariff noise' cast shadow over consumer confidence
Photo: RNZ Consumer sentiment has soured amid tariff-induced economic uncertainty and rising food prices. The ANZ-Roy Morgan Consumer Confidence Index fell 5 points fell in May to 92.9 - a reading below 100 means overall sentiment remains pessimistic. It comes after business confidence fell for the third month in a row . The fall in consumer sentiment erased gains from April . ANZ chief economist Sharon Zollner said it was the first consumer survey where most people answered after the start of "tariff noise". "That could be a factor," she said. "Also, we're experiencing quite high food price inflation at the moment and that tends to go down very badly with consumers." Perceptions about the outlook for the economy over the next 12 months fell 4 points to a net negative 20 percent - indicating most people thought the economy would see bad times financially. A net 10 percent of people felt it was a bad time to buy a major household item, a key indicator for the retail sector. "While that did lift 1 point, it's still a long way from suggesting happy days for the retail sector," Zollner said. Other questions in the survey showed a net 12 percent expected to be better off in a year's time, down 11 points. Household inflation expectations were largely steady, only easing 0.1 percentage points to 4.6 percent. "That's a lot higher than a couple of months ago, with the jump possibly caused by global tariff talk, though household inflation expectations can also be sensitive to food prices," Zollner said. "Household inflation expectations don't have a tight correlation with actual inflation outcomes," Zollner said. "But the perception that inflation is going to be so high is likely to contribute to the sense of a cost of living crisis, potentially dampening spending, if anything." ANZ continued to expect the Reserve Bank to cut interest rates three more times this year, lowering the Official Cash Rate to 2.5 percent. "Our best judgement is that the RBNZ will end up just shoring up the recovery because it's nothing flash at the moment," Zollner said. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Wall Street Journal
22-05-2025
- Business
- Wall Street Journal
Business Activity Rebounds in May
U.S. private-sector activity rebounded in May, though tariffs appear to be stoking inflation. Business confidence has improved from a month earlier, "with gloom about prospects for the year ahead lifting somewhat thanks largely to the pause on higher rate tariffs," said Chris Williamson, chief business economist at S&P Global Market Intelligence. An early read of S&P Global's purchasing managers indexes for manufacturing and services showed them both rising to 52.3. The two PMIs were at 50.2 and 50.8, respectively in April. A reading above 50 signals expansion, while a lower figure indicates contraction. Both May figures beat expectations of economists polled by The Wall Street Journal.
Yahoo
12-05-2025
- Business
- Yahoo
Rayner's workers' rights crush confidence to record low
Angela Rayner's plan to overhaul workers' rights has crushed business confidence to a record low, as bosses prepare to slash jobs and curb hiring. Optimism among employers has fallen to levels not seen outside of the pandemic, according to a new survey, with just 25pc of bosses claiming they expect to increase headcount over the next three months. This is the lowest level since late 2020, when Britain was still in the depths of Covid. A quarter of employers are also planning to make redundancies in the next quarter, the survey by the Chartered Institute of Personnel and Development found, as fears mount over the impact of looming red tape. Under the Deputy Prime Minister's Employment Rights Bill, bosses will be banned from handing out zero-hour contracts and flexible working will be made the 'default' for all. Workers will also be handed full rights from day one, including maternity and paternity leave, sick pay and protection from dismissal. The Bill is set to pile further pressure on businesses already battling Rachel Reeves's £25bn National Insurance tax raid, Donald Trump's trade war and the increase in the minimum wage. James Cockett, economist at CIPD, highlighted the threat Ms Rayner's reforms now pose to bosses given the new economic environment. 'The Employment Rights Bill is landing in a fundamentally different landscape to the one expected when it formed part of the Labour manifesto in summer of last year,' he said. 'It was always going to be a huge change for employers, but they're operating in an even more complex world now.' Andrew Griffith, the shadow Business Secretary, accused the Government of 'killing Britain's businesses' by pressing ahead with its Employment Rights Bill after increasing taxes. He said: 'Alongside making families £3,500 worse off, Labour's jobs tax is crushing confidence, killing jobs and pushing employers to the brink. Under Labour, the economy has flatlined and with businesses under mounting pressure, things can only get worse. 'This report only confirms what we hear daily from the shop floor to the boardroom – confidence has collapsed. Labour can't understand why because their cabinet has zero business experience.' It came as the Recruitment and Employment Confederation (REC) found another fall in the number of workers landing new permanent jobs last month, signalling a further lack of confidence in the economy. Neil Carberry, chief executive of the recruitment industry group, urged the Government to revisit its workers' rights reforms to ease pressure on businesses. He said: 'The biggest single drag factor on activity right now is uncertainty. Some of that can't be helped, but payroll tax costs and regulation design is in the Government's gift. 'Businesses have welcomed positive discussions with ministers on the Employment Rights Bill, but now it is time for real changes to address employers' fears and boost hiring. 'A sensible timetable and practical changes that reduce the red tape for firms in complying with the Bill will go a long way to calming nerves about taking a chance on someone.' Separately, the latest pay for newly-hired temporary staff increased at the fastest pace in 11 months, according to REC, fuelled by the latest rise in the minimum wage. This adds to the Bank of England's dilemma as officials fear rising pay will push up inflation, even amid a slowdown in the wider economy. It means the Monetary Policy Committee is expected to cut interest rates only cautiously after last week's reduction from 4.5pc to 4.25pc. A government spokesman said: 'Through our transformative Plan for Change, the Government has delivered the biggest upgrade to workers' rights in a generation, and our measures already have strong support amongst business and the public. 'We've consulted extensively with business on our proposals, and we will engage on the implementation of legislation to ensure it works for employers and workers alike.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
12-05-2025
- Business
- Telegraph
Rayner's workers' rights crush confidence to record low
Angela Rayner's plan to overhaul workers' rights has crushed business confidence to a record low, as bosses prepare to slash jobs and curb hiring. Optimism among employers has fallen to levels not seen outside of the pandemic, according to a new survey, with just 25pc of bosses claiming they expect to increase headcount over the next three months. This is the lowest level since late 2020, when Britain was still in the depths of Covid. A quarter of employers are also planning to make redundancies in the next quarter, the survey by the Chartered Institute of Personnel and Development found, as fears mount over the impact of looming red tape. Under the Deputy Prime Minister's Employment Rights Bill, bosses will be banned from handing out zero-hour contracts and flexible working will be made the 'default' for all. Workers will also be handed full rights from day one, including maternity and paternity leave, sick pay and protection from dismissal. The Bill is set to pile further pressure on businesses already battling Rachel Reeves's £25bn National Insurance tax raid, Donald Trump's trade war and the increase in the minimum wage. James Cockett, economist at CIPD, highlighted the threat Ms Rayner's reforms now pose to bosses given the new economic environment. 'The Employment Rights Bill is landing in a fundamentally different landscape to the one expected when it formed part of the Labour manifesto in summer of last year,' he said. 'It was always going to be a huge change for employers, but they're operating in an even more complex world now.' Andrew Griffith, the shadow Business Secretary, accused the Government of 'killing Britain's businesses' by pressing ahead with its Employment Rights Bill after increasing taxes. He said: 'Alongside making families £3,500 worse off, Labour's jobs tax is crushing confidence, killing jobs and pushing employers to the brink. Under Labour, the economy has flatlined and with businesses under mounting pressure, things can only get worse. 'This report only confirms what we hear daily from the shop floor to the boardroom – confidence has collapsed. Labour can't understand why because their cabinet has zero business experience.' It came as the Recruitment and Employment Confederation (REC) found another fall in the number of workers landing new permanent jobs last month, signalling a further lack of confidence in the economy. Neil Carberry, chief executive of the recruitment industry group, urged the Government to revisit its workers' rights reforms to ease pressure on businesses. He said: 'The biggest single drag factor on activity right now is uncertainty. Some of that can't be helped, but payroll tax costs and regulation design is in the Government's gift. 'Businesses have welcomed positive discussions with ministers on the Employment Rights Bill, but now it is time for real changes to address employers' fears and boost hiring. 'A sensible timetable and practical changes that reduce the red tape for firms in complying with the Bill will go a long way to calming nerves about taking a chance on someone.' Separately, the latest pay for newly-hired temporary staff increased at the fastest pace in 11 months, according to REC, fuelled by the latest rise in the minimum wage. This adds to the Bank of England's dilemma as officials fear rising pay will push up inflation, even amid a slowdown in the wider economy. It means the Monetary Policy Committee is expected to cut interest rates only cautiously after last week's reduction from 4.5pc to 4.25pc. A government spokesman said: 'Through our transformative Plan for Change, the Government has delivered the biggest upgrade to workers' rights in a generation, and our measures already have strong support amongst business and the public. 'We've consulted extensively with business on our proposals, and we will engage on the implementation of legislation to ensure it works for employers and workers alike.'
