Interest Rate Outlook
The RBA again raised rates to 4.10% at their June meeting. Based on a surprisingly higher monthly inflation read and other items such as wage increases and a surprise lift in residential property prices, the RBA had little choice but to raise. Whilst not a surprise given the inflation signs, the raise comes after there was a feeling that rate pressure had peaked and may start to abate towards the back half of the year.
The latest rise will no doubt add further fire to the theory of a significant slow down in the second half of the year.
The monthly CPI indicator annual movement rose to 6.8% in March, up from 6.3% in February. Clearly inflation is sticky and there are fears of an inflation spiral meaning rates may need to stay higher for longer.
Interestingly, the movement for the monthly CPI excluding volatile items and holiday travel rose 6.5% in April, down from 6.9% in March. This measure excludes fruit and vegetables, fuel and holiday travel.
Other notable items
- The minimum wages has been raised by 5.75%
- The PwC scandal takes main stage in the professional services sector
- US tech stocks are up 33% in 2023 lead by Nvidia as investors think they are best placed to make the most of AI in their business models
Upcoming Lodgement Dates for June:
- 21 June – Lodge and pay May 2023 monthly business activity statement (IAS)
- 26 June – Lodge and pay Fringe Benefits Tax
- 30 June – End of Financial Year