LABOR TRIUMPH IN VICTORIA; RBA PRICE TIP
Andrews Labor Government sweeps back in Victoria
Daniel Andrews’ Labor Government has been easily re-elected in Victoria, securing a third term with a likely majority of up to 12 seats. According to the Victorian Electoral Commission, the Liberal Party has lost at least three seats but the party’s losses have been offset by its Nationals partner seizing three seats off regional Independents. In a potential pointer to the New South Wales election in March 2023, the so-called Teal independents appear unlikely to repeat their inner-city successes of the May Federal poll. The Greens, however, are on track to pick up a seat off Labor. Meanwhile, Labor’s potential tally of 55-57 seats in the 88-seat Lower House of the Victorian Parliament is unlikely to be mirrored in the State’s Upper House; in its third term, Labor will again need to deal with a range of minor party crossbenchers to pass legislation.
Inflation on way to three per cent, says RBA Governor
Reserve Bank of Australia (RBA) head Philip Lowe has forecast that inflation will peak around eight per cent by the end of this year, but then decline to be just above three per cent by the end of 2024. In a speech to industry, the RBA Governor said Covid-19 disruptions to supply were being resolved and the pressure on goods prices was abating. In addition, Dr Lowe said, commodity prices had stabilised, which would be evident in future consumer prices. Finally, rising interest rates would slow aggregate demand, resulting in less pressure on capacity, and lower inflation.
Labor shifts ground on employment bill
The Federal Government has given way in negotiations with the Senate crossbench on its legislation to lift wages for lower-paid workers. Employment Minister Tony Burke said the Government would concede to demands from Independent ACT Senator David Pocock on greater exemptions for small business on multi-employer bargaining. Small businesses with less than 20 employees would be exempted from the single-interest stream of the proposed laws, with additional concessions to businesses of less than 50 employees. Mr Burke also said the Government would commit to an annual pre-Budget review of welfare payments, in the amended legislation due to be debated in the final week of Parliament.
Treasurer backs Australian prospects in critical minerals
Federal Treasurer Jim Chalmers has spelt out the challenges and opportunities for Australia in meeting the global demand for critical minerals and rare earths. In an address to a critical minerals forum, Dr Chalmers said the number of electric vehicles produced globally was projected to increase by 30 per cent a year for the next 30 years, driving demand for lithium, cobalt, nickel and graphite for batteries. Copper and rare earth elements would also be required for electric vehicles’ permanent magnets. The Treasurer said Australia supplied about 55 per cent of the world’s lithium, with global demand for lithium by 2040 expected to be 40 times greater than 2020 levels. Australia was the fourth largest producer of rare earths, with rare earths mining dominated by China.
Retail trade falls for first time in 2022
Rising interest rates may be starting to take their toll on consumers, with retail trade in October recording its first monthly fall in 2022, according to official figures. The Australian Bureau of Statistics says that retail trade fell 0.2 per cent, seasonally adjusted, in October, following successive monthly rises since December 2021. On a year-on-year basis, retail trade rose 12.5 per cent, reflecting a gradual recovery since the Covid-19 waves of late 2021. The Northern Territory, Tasmania and the ACT recorded the biggest falls in monthly retail trade during October.
$1 billion fund for disaster mitigation
Legislation for a dedicated fund to provide up to $200 million a year for mitigation from floods, fires and cyclones has passed Federal Parliament. The Disaster Ready Fund (DRF) would make up to $1 billion available over the next five years for important disaster mitigation projects. Emergency Management Minister Murray Watt said the most effective way to bring down insurance premiums was to better safeguard properties from the impact of natural disasters. The DRF replaces the Emergency Response Fund, with potential projects for investment including flood levees, cyclone shelters, fire breaks and evacuation centres.