Weekly Update: 01.07.22

“Australia’s economy continues to demonstrate resilience, underpinned by its scale, diversity and high incomes, as well as its highly flexible labour, product and capital markets, well-regulated financial system and floating exchange rate.”

Moody’s confirms Australia’s AAA rating

Parliamentary Update:

• Treasurer Jim Chalmers appeared on ABC Insiders and confirmed that the Albanese Government’s Jobs Summit would “most probably be in September, subject to consultation”.
• The Treasurer and Minister for Employment and Workplace Relations released a statement welcoming an increase in the minimum wage from 1 July.
• The Superannuation Guarantee rate increased 0.5 percentage points from 10 per cent to 10.5 per cent today.
• The Prime Minister has been in Europe attending a number of international events. Among other issues, the PM stated he was hopeful of the resumption of free trade agreement talks with the EU.

Shadow Treasurer Angus Taylor stated that the long-standing inflation target band of 2% to 3% should not be adjusted by the Albanese government’s review of the RBA.

Economic Update:

• RBA Governor Philip Lowe has continued to play down the possibility of a 75bps increase in the July cash rate target, confirming a likely 25 or 50 bps increase.
• Ratings house Moody’s reaffirmed Australia’s triple-A credit rating. The Treasurer welcomed the statement and noted that “Australia remains one of only nine countries to hold a AAA credit rating from the three major rating agencies”.
• The RBA released its financial aggregates for the year ending May 2022. Total credit was up 9.0: business (12.9%), housing (7.9%) and personal (-2.8%). Broad money was up 10.4%.
• The G7 met this week, agreeing to stick by Ukraine and to impose further costs on Russia, with several proposals, including a cap on the price of Russian oil and gas. An additional $4.5 billion was announced for those most at risk of hunger and malnutrition due to the Russian blockade of Ukraine’s Black Sea grain ports. 

It’s the second anniversary of the CDR in Australia. See the full open banking timeline, with upcoming deadlines

Regulatory Update:

• The RBA held its 2022 annual conference, covering the causes, challenges and consequences of the low interest rate environment. Marco Del Negro of the Federal Reserve Bank of New York discussed Global Trends in Interest Rates.
• AUSTRAC is planning upcoming sessions and surveys for its Customer Advisory Group (CAG), including a suspicious matter reports review.  Enquiries to join the CAG here: haveyoursay@austrac.gov.au.
• The first neo-bank to gain a licence under the 2019 rules, Volt Bank, will close, handing in its banking license to APRA. $100 million will be returned to 6000 customers by 5 July.
• The BCCC released its latest findings and Good Practice Guides (CX4423) and (CX6212): the BCCC expects strict compliance under banks’ obligations under the code when executing guarantees; and that bank staff training should go beyond mere awareness of the Code’s role in consumer protection.

Communications:

• The ABA has produced three new credit reporting fact sheets for customers and financial counsellors. From 1 July, customers who enter into a financial hardship agreement with their bank will have their credit history protected (provided they meet their obligations).
• The ACSC, ATO, ASBFEO and ABA discussed threats of Business Email Compromise schemes in a webinar earlier this week. The ATO has taken down about 600 fake ATO websites in the past year. The ABA’s new anti-scams campaign promoting PayID begins 18 July.

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Weekly Update