LOWE TAKES HIS LEAVE
Philip Lowe will chair his last meeting of the Reserve Bank of Australia board today, and markets predict the cash rate will be untouched. The Australian Securities Exchange’s RBA rate tracker indicated a long-shot 14% expectation the Reserve Bank would cut the official interest rate to 3.85% at today’s meeting. “No one really expects Australia’s central bank to change its cash rate target on Tuesday. Markets are priced for no change and consensus is unanimous that the rate will stay parked at 4.1%,” Scotiabank vice president Derek Holt told The Australian Financial Review ($). Jonathan Kearns, chief economist at Challenger, told Guardian Australia: “The market is effectively pricing no further hikes or cuts for a year.”
Incoming RBA governor Michele Bullock has “recently warned of the need for restrictive policy in her recent comments”, Holt said. Her reign will begin as some analysts warn a fixed-rate mortgage cliff could force some people to sell their homes. The Courier-Mail ($) reports “an estimated $60m worth of fixed-rate mortgages expired across the big four banks during July and August … with a further $30m set to revert to variable terms come the end of September,” citing PropTrack data. The takeaway? “One in seven homeowners fear being forced to sell their home due to rising costs”. With the Australian Bureau of Statistics set to release June quarter numbers on public demand and trade today, we’ll soon know more about how the country’s economy is faring.
As for Lowe, the website Livewire Markets predicts his most memorable contribution as RBA governor might end up being comments he made in 2020 and 2021 and later apologised for. Lowe indicated several times that cash rates weren’t likely to rise until 2024. Obviously that didn’t turn out to be the case. Last November, Lowe told a Senate hearing he should have added more caveats to those statements: “I’m sorry that people listened to what we’ve said and acted on that, and now find themselves in a position they don’t want to be in.”
QANTAS QUESTIONS
Anthony Albanese “can’t be clearer”: he received “no lobbying” from Qantas over blocking Qatar Airways from offering more flights to Australia. But the prime minister did leave one detail to the imagination — as The Australian ($) and others report this morning, Albanese in yesterday’s question time refused to name an individual with whom he did speak about the move. “I had one extensive conversation with someone about Qatar. It was not someone with Qantas,” the PM said.
There are further Qantas details we’re not allowed to know for now. “The parliamentary stoush came as Qantas on Monday refused to say when top executives — including [Alan] Joyce and his incoming successor, Vanessa Hudson — knew of a competition watchdog investigation and intended lawsuit into allegations the airline was knowingly selling tickets on cancelled ghost flights,” The Australian reports.
It also isn’t clear whether Joyce or the Qantas board knew of the probe when he was given permission to sell 2.5 million Qantas shares in June. “Joyce sold his shares for $17m in June but the ACCC case has been one of many factors that has driven the share price down by 7% since, to $5.60, meaning Joyce would have netted $3m less if he sold those shares today,” The Daily Telegraph ($) reports. The newspaper stressed it did not suggest any wrongdoing by Joyce or any board member, and to be clear, neither does the Worm.
Say What?
I’m excited to see the memes.
Olaf Scholz
The German chancellor, one of Europe’s most powerful men, was powerless to prevent a jogging accident that injured his face and left him with dark-red bruises and the need to wear an eye patch. He posted a picture of his new look on X, the platform formerly known as Twitter, and added that “it looks worse than it is”. A spokesperson for Scholz told reporters in Berlin the picture was posted “so that everyone can get used to how he will look in the next week or two”, the Associated Press reported.
CRIKEY RECAP
“Despite a regulatory probe that could see Qantas fined as much as $600 million for allegedly selling tickets on 8000 cancelled ‘ghost’ flights in 2022, Qantas pilots claim the national carrier is continuing to sell tickets on flights it knows will not take off.
“One of the company’s 787 long-haul aircraft is out of service. The plane was hit by a loader about 10 days ago (Qantas won’t say when exactly; in fact, it won’t say anything) and will not be back in service until at least September 10 because it needs a major repair, Qantas engineers told Crikey.
“This means Qantas will continue to cancel international flights on routes that use 787s — Dallas, Los Angeles, London, New York, Johannesburg and Santiago — because it has no spare planes. This is largely because outgoing chief executive Alan Joyce has continually delayed the purchase of aircraft to reduce capital spending and improve the company’s bottom line.”
“Opposition Leader Peter Dutton’s proposal for a second referendum to impose what would be a unilateral non-Indigenous recognition of First Peoples is politically smart — too smart by half. Dutton’s concern is that his relentless opposition to a constitutional Voice to Parliament will wreck any chance the Liberals have of reclaiming teal seats at the next election, without which his task of securing even minority government is dramatically harder.
“His solution is a second referendum on unilateral white recognition, which, along with a legislated Voice, will enable him to pitch to Yes supporters.
“We know Dutton’s legislated Voice simply doesn’t stack up. Having campaigned ferociously against a constitutional Voice as a sinister elite plot, another layer of bureaucracy and a dangerous experiment, Dutton now pushing for a legislated rather than constitutionally enshrined Voice — in effect, rejecting the result of the referendum — looks downright bizarre.”
READ ALL ABOUT IT
Ukraine says Russian drones crashed in Romania (BBC)
Volodymyr Zelenskyy replaces Ukrainian defense minister, citing need for ‘new approaches’ (CNN)
No sign of Black Sea grain breakthrough after Erdoğan-Putin talks (The Guardian)
Security in Ecuador has come undone as drug cartels exploit the banana industry to ship cocaine (Associated Press)
Gabon coup leader Brice Nguema sworn in as ‘transitional’ head of state (France24)
Smash Mouth lead singer Steve Harwell dead at 56 (TMZ)
THE COMMENTARIAT
The housing joke is wearing thin for the TikTok generation — Millie Muroi (SMH): “Dark humour has become a coping mechanism of sorts. Remember the “feed your family for $10” Coles commercial with Curtis Stone? Friends at work recently pointed me to a video making rounds on TikTok showing $10 only bought a bag of cheese. That evening, I walked into Coles and saw that wasn’t a joke. I had to laugh.
“But, really, that’s a problem. When wages are rising slower than prices, it’s no surprise that banks aren’t eager to lend to those with lower incomes and savings. The fact that many young people are also saddled with tens of thousands of dollars of tertiary education debt doesn’t help.
“ANZ boss Shayne Elliott blames regulation for the banks’ diminishing ability to lend to ‘risky’ borrowers. Tighter lending standards and capital requirements over the years from the Australian Prudential Regulation Authority (APRA), have meant banks are unable to extend credit to those who are less wealthy, he argues, or have to pass on the higher compliance costs to customers.”
Yes or no, when the voice vote is over, Indigenous Australians will have to come together — Luke Pearson (Guardian Australia): “I started the year in the fairly lonely ‘I don’t know’ camp but I think I’m ending it in the ‘I don’t care any more’ camp. I care much less for what happens on the day the votes will be counted than I do for the days and months and years that will follow.
“The rift that the debate itself has caused between those mob who support it and those mob who oppose it will need to be mended. Don’t get me wrong, I know a lot of mob have been on opposite sides long before this battle turned up on our doorsteps.
“But I feel like this divide has torn asunder relationships between many who otherwise agree on the vast majority of issues, and they are going to need to find a way forward together, beyond this. Some will find this easy, others will not.”
Feeling lonely? Too many of us do. Here’s what our supermarkets can do to help — Louise Grimmer (The Conversation): “Even before COVID-19, social isolation and loneliness were all too common across the community. Living among millions of other people is no comfort for people in cities, where the pace of life is often hectic, and technology and digitisation often limit, rather than help with, social interaction.
“The pandemic amplified these problems. In its wake, more of us report we’re lonely.
“For some, a weekly shopping trip may be the only chance to interact with others. A supermarket chain in the Netherlands is helping to combat loneliness with so-called ‘slow’ checkouts where chatting is encouraged. Could a similar approach work here?”
