No change in interest rates from today’s Reserve Bank board meeting today, the last for 2014.
But if you are interested, it will pay to read Governor Glenn Stevens post meeting statement, especially what he says about the weakness of the Aussie dollar which traded lower yesterday, through a succession of new multi year lows.
The currency was trading well under 85 US cents in early Asian trading Tuesday morning after the big sell off in Australian shares and another slide in key global oil prices.
But it rebounded offshore and was trading around 85.20 this morning – more than a cent above the four year low of 84.14 it hit at lunchtime yesterday when the weak Chinese manufacturing data was issued.
Gold also fell as speculators’ hopes of a boost from the Swiss referendum requiring the country’s central bank to buy more gold, were dashed.
Indian moves to relax gold import rules had no impact as gold again plunged to within $US20 of this year’s low of $US1,032.
But gold rebounded overnight, jumping more than $US40 an ounce to end around $US1,217.
Oil prices also bounced, with Brent back above $US72 a barrel and US crude topping $US68 – rises of more than 3%.
Data out yesterday showed the gains in house prices slowed in November, while inflation fell according to a private survey, but manufacturing activity moved back solidly into the expansion phase with a reading of 50.1 on the AIG monthly survey.
The rise of 0.7 was put down to the fall in the value of the Aussie dollar making companies in manufacturing more confident.
Capital city house price growth continued to slow in November, with only Sydney, Brisbane, Perth and Hobart showing any month-on-month advance, according to the latest report from CoreLogic RP Data.
Nationally, prices slipped 0.3 per cent, although this masked growth of 1% in Sydney, 0.9% in Perth and small advances in Brisbane and Hobart.
For the three months to the end of November, national price growth was 0.8%, while the year-on-year change was 8.5%, down from around 11% earlier in the year.
And data on business stocks, company profits, sales and salaries, released yesterday for the national accounts tomorrow, showed a generally buoyant tone.
Inventories were up 0.7% seasonally adjusted in the three months to September, compared with the 0.9% rise in the June quarter (revised up from 0.8%).
Seeing that 0.8% rise contributed 0.9% to economic growth in the June quarter, there’s another solid contribution for the September quarter coming from rising stock levels.
Company profits and wages and salaries also rose, which generally adds to economic growth.
