Loading
The lowdown
ABS figures on Wednesday showed the annual rate of inflation slowed to 6 per cent in the year to June. In the three months to June,the consumer price index rose by 0.8 per cent,driven by rents,international travel and accommodation,financial services and new dwelling purchases.
Deloitte Access Economics partner Stephen Smith said the data would give the RBA a lot to chew on ahead of next month’s policy announcement.
“The inflation data released today is further evidence that the Reserve Bank has increased interest rates too far,” Smith said.
“The Australian economy is softening dramatically,the pace of inflation has peaked and is moderating quickly,wage growth is not excessive and medium-term inflation expectations are not rising. In that context,there should be no further interest rate increases in Australia.”
AMP chief economist Shane Oliver also thinks the data should be enough to see the RBA keep rates on hold next week. “But it’s a very close call as the RBA is still likely to be concerned by still-high underlying inflation on a year-on-year basis,the still-tight jobs market and upside risks to wages growth,” he wrote in a note.
Online retailer Kogan.com’s share price increased by 10 per cent after the company told investors it had managed to reduce the value of its inventories by close to 60 per cent since June 30,2022.
Meanwhile,premium wagyu producer Australian Agricultural Company (AACo) sank 4.6 per cent as investors digested the news that its majority owner,British billionaire Joe Lewis,has been charged over insider training in the United States.
Overnight,the S&P 500 rose 0.3 per cent to its highest close since early April 2022.
Quote of the day
“I never knew my husband was someone who said things like ‘circle back’ and ‘touching base’ until COVID lockdowns forced us to work side by side at the dinner table.”
That’s LinkedIn careers expert Cayla Dengate,whoopines about the good and bad of office lingo,which in this WFH era can either bind you together as a team or make you feel excluded.
Tweet of the day
You may have missed
It might be a bit too early to celebrate the inflation data.As columnist Elizabeth Knight writes,there is certainly a school of economists who believe the latest inflation number demonstrates sufficient progress has been made in the inflation fight that the Reserve Bank can down its monetary gun and leave rates where they are.
There is another cohort of economists who believe the central bank has one interest rate bullet to fire. But those who were predicting two more rate rises are disappearing fast.Read more here.
With AP
The Market Recap newsletter is a wrap of the day’s trading.Get it each weekday afternoon.