Weekly Update 19.08.22

This is an opportunity for us to hear and discuss the views of other economists in a more structured way than has been done to date. We look forward to listening, discussing and learning.”

–    RBA Governor Philip Lowe, on new biannual private-sector panel

Regulatory Update:

• The RBA has announced it’s establishing a biannual panel of up to a dozen rotating private-sector economists. The first meeting is planned for 6 October. The agenda will include the current challenges facing the economy and the appropriate role of forward guidance in monetary policy. 
• The ACCC is investigating competition for social media services in Australia as part of its five-year Digital Platform Services Inquiry. The ACCC is also seeking views on the use and abuse of social media services for scams and misleading or deceptive content. Read the March 2023 interim report Issues Paper.
• The RBA released its minutes for the August monetary policy decision, where it raised the cash rate target to 1.85%. The RBA expects the CPI to reach 6% by the end of 2022, and the WPI to reach 3.75% by the end of 2024.

Parliamentary Update:

• The ABA will be attending the Jobs + Skills Summit in September. The Issues Paper for the summit has been released, outlining broad themes and focus. Topics for proposed discussion include:
  • What policies would be most effective to sustaining full employment into the future and what are the biggest challenges and risks to achieving this?
  • What can be done to ensure the benefits of productivity improvements are harnessed to lift the living standards of all Australians?
  • How can bargaining be revitalised to help boost productivity and sustainable wage growth?
  • How can we achieve equal opportunities for women and close the gender pay gap?
• Assistant Minister for Competition, Charities and Treasury Andrew Leigh has announced an amendment to penalties for breaches of competition and consumer law, including raising penalties to $50 million for corporations and $2.5 million for individuals. Consultation closes Thursday 25 August 2022.
• NSW Minister for Customer Service and Digital Government Victor Dominello has announced his intention to retire from politics at the next election in March 2023, due to a family health issue.

Economic Update:

• Chinese spending on climate transition dwarfs the rest of the world. Aiming to be carbon neutral by 2060, China spent $297.5 billion last year on the energy transition, while EU member states devoted $155.7 billion and the US $119.7 billion.
• The unemployment rate has fallen to 3.4%. The ABS released figures showing that the unemployment rate fell for men (down 0.2 percentage points) to 3.4%, and remained at 3.4% for women. The participation rate fell 0.3% in July, 2022. Bjorn Jarvis, head of labour statistics at the ABS, said: “This is the first fall in employment since October 2021, following the easing of restrictions after the Delta lockdowns in late 2021.” 
• Wages grew 2.6% in the year to May. The WPI grew 0.7% in the June Quarter. This is the third consecutive quarter of growth in the WPI. “This is the highest annual rate of wages growth since September 2014.”, said Michelle Marquardt, Head of Prices Statistics at the ABS.
• The ABS is releasing monthly CPI data from October, in line with the (IMF) Special Data Dissemination Standards (SDDS). Australia is one of only two OECD economies (the other is New Zealand), that does not produce a monthly CPI. When combined with quarterly and annual price collections, the new monthly CPI indicator represents up-to-date prices for between 62 and 73% of the weight of the CPI basket.
• Average weekly earnings increased by 1.9% to $1,769.80 to May 2022. On average, public sector males out-earned private sector females by more than $500:
  • Males $2,075.30 (public), and $1,835.60 (private).
  • Females $1,821.30 (public), and $1,523.60 (private).

Communications:

• The ABA has joined the Taskforce on Nature-related Financial Disclosures (TNFD) Forum. The TNFD Forum is a global multi-disciplinary consultative group of institutions with over 550 members, including multiple ABA member banks. Membership will provide the ABA opportunities to support the research and technical work of the taskforce and remain well-informed on nature-related risk management and disclosure trends and developments. 
• The ABA is submitting its survey response to the Department of Climate Change, Energy, the Environment and Water (DCCEEW) today, laying out the ABA’s position on this global framework.
• The ABA’s national anti-scams campaign will conclude next week.

Read the full Update

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