NAB Survey
The NAB Survey for December showed business conditions at a reading of +9, solid, but a bit below where we were back in October.
Business confidence remained soft at a reading +3.
Final prices remained relatively subdued, while the reading for retail prices was the lowest since 2020.
Nothing too alarming there - however capacity utilisation only edged down slightly to a still-elevated 83.2 per cent, and labour shortages still appear to be an ongoing issue.
After a hotter than expected inflation reading for New Zealand in the December quarter, in Australia markets have been repositioning for a likely hike at the next RBA Board meeting.
Market pricing shifts
Australia's 3-year bond yield has traded up to 4.28 per cent, while the dollar has screamed higher.
A year ago commentators were panicking that the dollar falling to below 62 US cents might import inflation - today the Aussie is trading at 69.2 US cents!
Whether or not there is a hike next month will depend on the December quarter inflation figures.
Inflation has become an issue again in Australia due to a combination of big government spending - in particular on the NDIS - high rates of population growth driving rents and housing costs higher, and ongoing increases in power bills.
Westpac's revised down forecast of 0.7 per cent for trimmed mean inflation would see core inflation over the 12 months of around 3 per cent - probably enough to keep rates on hold - while the median market forecast of 0.8 per cent would likely result in a hike.
Looking through the noise, this cycle might incorporate a couple of interest rate hikes taking the cash rate target back up to 4.1 per cent.
Source: ASX
The inflation figures are due for release in the morning at 11.30am AEDT.
---
1. Download our property buying guide
Download our free property buying guide here.
You can also check out a few of our recent property purchases here.
Get in contact with us today if strategic property investment is your thing.
2. Subscribe to our Top 10 Podcasts for Investors
Listen in to our podcasts
The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with over 50,000 audio downloads per month, and growing fast.
And our popular Low Rates High Returns Show also remains available on Spotify.
3. Subscribe for my free daily blog
Subscribe for my free daily blog with 4½ million hits here.
You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 16,000 followers.
By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.
My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here.
4. Work with me privately
For a limited time you can book in a free diagnosis call with me here, so book in a call today.
