In Australian news this week, it was revealed that the economy grew by just 0.2 per cent in the September quarter and 2.1 per cent over the year to end-September. It was noted that, although this was the eighth straight rise in quarterly GDP, growth has slowed over 2023 in response to the series of interest rate increases.
In Australian economic news, the Reserve Bank of Australia decided to keep its official interest rate unchanged at 4.35 per cent at its meeting yesterday. The statement that accompanied the decision suggested that there had been limited information released since its decision to raise the cash rate in early November, and what had been received was broadly in line with its expectations.
In a quiet week for market and economic news, there has been a focus on a change in tone from Reserve Bank of Australia about the need for further interest rises to slow inflation.
Stoic Venture Capital’s investment partner Uniseed made an exciting announcement this week. Five years ago Stoic and Uniseed started a partnership journey to help fund the commercialisation of life science and deeptech university start-ups.
In market news this week, two of the four major Australian banks posted record profits in the face of sluggish growth in the economy. Both also noted that distressed debt remained at low levels despite the repeated increases in interest rates.
The key Australian economic and market news this week was the decision by the Reserve Bank of Australia to raise the official interest rate by 25 basis points to 4.35 per cent. In doing this, it stressed that inflation in Australia has passed its peak but is still too high and is proving to be more persistent than expected.
The key Australian economic and market news this week were new data on inflation in the September quarter. The headline rate of inflation (the Consumer Price Index (CPI)) rose 1.2 per cent in the September quarter and 5.4 per cent annually. The quarterly outturn was a significant acceleration from the 0.8 per cent rise in the June quarter, albeit lower than seen throughout 2022.
Domestic and global markets remained in turmoil this week as tensions continued to escalate in the Middle East. Ongoing upward pressure on oil prices exacerbated the volatility in financial markets, which are jittery about the impact that the conflict could have on the outlook for global demand, and the campaign across the developed world to tame inflation.
This week’s news has been dominated by the conflict and humanitarian crisis in Israel and the Gaza strip. Related to this, there was considerable concern about the impact a crisis-related surge in oil prices will have on inflation across the world.