Rates tipped to remain on hold, Account deficit lifts in fourth quarter: Midday Roundup

The Reserve Bank is expected to keep the official cash rate on hold at this afternoon’s board meeting.

An AAP survey of 13 economists found there was a unanimous expectation rates would remain at 4.25%. The RBA also kept the rate on hold at last month’s meeting.

However, consumer confidence has been battered by the decision by all four major banks to raise rates independently that decision, indicating they may do so again.

The RBA cited an improved global outlook last month in its decision.

Account deficit lifts in fourth quarter

The current national account deficit grew more a higher than expected rate in the December quarter, according to the latest figures from the Australian Bureau of Statistics.

The figures show Australia had a seasonally adjusted account deficit of $8.37 billion for the three months ending December, although the forecast had been for an account deficit of $8.1 billion.

This figure comes after an upwardly revised deficit of $5.82 billion for the September quarter.

Westpac to cut more staff, union claims

The Finance Sector Union has claimed Westpac will cut 119 technology jobs soon with another seven to be scrapped as the company continues to reduce costs.

As reported by Fairfax, the FSU says the majority of the jobs are centred in the Sydney business district and in the southern fringe, although some will be cut in other states as well.

Speaking to the publication, Westpac chief operating officer John Arthur said that “restructuring decisions are always difficult”.

“We are acutely aware of the impact on our people and are committed to supporting our people through this change,” he said.

“The financial services industry is undergoing significant structural change as banks strive to become stronger by being more efficient and competitive in serving customers’ needs.”

Shares fall over concerns regarding Chinese growth

The Australian sharemarket has fallen this morning after concerns have continued to rise over growth in China, while a possible setback in the Eurozone over a Greek bailout deal has also made investors nervous.

The benchmark S&P/ASX200 index was down 24 points or 0.6% to 4238.8 at 12.00 AEST, while the Australian dollar fell to $US1.06c.

In the United States, the Dow Jones Industrial Average fell 14.8 points or 0.11% to 12,962.81.


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