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Hedge Clippings | 08 March 2024
This week saw a slew of Australian economic data released, including Housing, Labour and Employment numbers, and National Accounts.
Housing first - According to the ABS, January's total housing finance fell 3.9% in January, coming after a fall of 4.1% in December 2023. Even though that's still 8.5% higher than a year ago, owner-occupied housing fell 4.6% and was only 3.4% higher than January 2023.
Today's Labour figures for the December quarter showed actual hours worked dropped by 0.3% - the second quarterly drop in a row. This was the first time since March 2014 that two consecutive quarterly falls had occurred, excluding the COVID era. Job vacancies also fell by 5.6% for the quarter, the fifth consecutive quarterly fall, although again COVID related issues have played havoc with trend numbers.
Both of these followed on from the release of the National Accounts on Wednesday. While overall the economy grew by 0.2% in the December quarter, the rate of GDP growth declined for the fourth straight quarter.
It seems the multiple rate hikes to date from the RBA are having the desired effect, so the question now is how soon before they might start to cut rates? Probably not at the next meeting, unless the board changes their tune the week after next, or fall in line with US Federal Reserve Chairman Jerome Powell's comments that the Fed was close to being able to reduce rates. The RBA's minutes of the February meeting were customarily cautious, noting that there had been "further progress towards their objectives, but that more progress was required, and the outlook remained uncertain". One known unknown, or uncertainty that the RBA noted that they were going to have to grapple with was the effect that the revised Stage 3 tax cuts, due from July 1, will have on spending.
Moving overseas, Trump's legal issues continue to mount even as his GOP nomination is confirmed. AP News even has a dedicated web page to track his various court cases. Like him or loathe him, and there's seemingly plenty in both camps, the fact that he's still in November's US presidential election race is extraordinary. US TV show host Jimmy Fallon summed it up well in this TikTok clip which even if you're a fan of the Donald, is pretty clever.
In Australia, even a (relatively speaking) minor mis-step, such as Barnaby having one too many drinks and having to lie down on the footpath while he phoned his wife, would spell curtains for higher office. Equally extraordinary is the reality that Joe Biden, if elected, will be 86 by the time his second term ends, while Trump himself will be 82.
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