Weekly Update: 27 September 2024

Highlights this week:

• Announcement: RBA keeps interest rate on hold at 4.35%.
• Key Data: Inflation cools to 2.7% in annual terms in August.

Quote of the week:
“Our relationship with China is full of complexity and it’s full of opportunity. We recognise that a more stable economic relationship between Australia and China is a good thing for Australian workers and businesses, investors and our country more broadly.”

– The Hon Dr Jim Chalmers MP, Treasurer. Joint press conference, Brisbane. 25 September 2024.

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Media & Communications Update:

• The ABA provided a response to News Corp on what the industry is doing to protect customers from identity theft, saying: “banks are introducing biometric checks to help verify the identity of people trying to open-up new accounts, and this could involve checking a customer’s face or fingerprint to help verify their identity.”
• A response was also provided to the AFR on surcharging and the costs of payments with the ABA saying “payment rails are invisible, like the 5G network and water pipes, it doesn’t mean they are free to operate – they have to be built, maintained and upgraded, which all requires significant investment.” 

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Policy Update:

• The ABA:
  • met with Treasury to discuss the Scams Prevention Framework Bill.
  • hosted a member COSBOA roundtable.
  • met with MFAA to discuss ASIC’s information sharing and background checking protocol.
  • attended ARNECC’s Interoperability Industry Panel to discuss the updates on IOP.
  • met with World Bank to discuss the World Bank’s research.

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Regulatory Update:

• APRA issued its response to its July 2024 consultation on the remaking of Prudential Standard APS 117 Capital Adequacy: Interest Rate Risk in the Banking Book.
• The RBA board released the September Statement on Monetary Policy.
• The RBA updated the chart pack on the Australian economy and financial markets.
• The RBA released the Payments Systems Board Annual Report 2024.
• The RBA released the Financial Stability Review for September 2024.

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Parliamentary Update:

• The Age and Sydney Morning Herald reported that Federal Treasury officials are working up options to scale back negative gearing and capital gains tax concessions.
• Treasurer Jim Chalmers travelled to Beijing for meetings on Thursday and Friday. He is meeting with Chinese counterparts during the two-day trip, including with the chair of the National Development and Reform Commission Zheng Shanjie. The Treasurer will also co-chair the Australia China Strategic Economic Dialogue.
• The Treasurer held a joint press conference with Finance Minister Katy Gallagher discussing inflation, the Final Budget Outcome, negative gearing and housing.
• Financial Services Minister Stephen Jones took part in an interview on ABC Radio Darwin on the Government’s Scam Prevention Framework.
• Shadow Treasurer Angus Taylor appeared on ABC RN discussing inflation, the recent RBA cash rate decision, and negative gearing.

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Economic Update:

• Inflation in the 12 months to August was 2.7%, coming within the RBA’s target band of 2-3% for the first time since August 2021.
• Job vacancies have fallen to 329,900, continuing their downward trend from a peak of 466,500 in May 2022.

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Coming up next week:

Parliament/Regulators:  

• No parliamentary sittings
• Parliamentary hearings: social media; insurance

Data announcements: 

• 01/10 – Retail Trade, Australia
• 01/10 – Building Approvals, Australia
• 04/10 – Lending Indicators
• 04/10 – Monthly household Spending Indicator

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Upcoming Submissions:

Published submissions

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Upcoming Events:

The ABA invites you to join us for a briefing by Housing Australia on their latest ‘Housing Australia Trends and Insights Report’ in September, focused on improving housing outcomes for Australians to be held Tuesday 15 October from 2.00pm to 3.00pm.

To register, please email Nat Madden, Associate Director, Events at nat.madden@ausbanking.org.au

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Selected Media:

• SMH – Negative gearing changes should not hurt middle income investors
• The Australian – RBA will be late to rate cut party, but it’s on the way
• AFR – ASIC wants crypto start-ups to hold financial services licensesABC – Australians are experiencing more economic ‘misery’ than they have since 2011, new research says
• AFR – ‘Greens are out of control’: RBA reform dead as Labor rejects demands

Warm regards,
The ABA Team

Weekly Update