1 00:00:03,880 --> 00:00:06,920 Speaker 1: It's Thursday, the fifteenth of May twenty twenty five. Welcome 2 00:00:06,960 --> 00:00:09,240 Speaker 1: to the Fast five Business News by Fear and Greed, 3 00:00:09,240 --> 00:00:11,080 Speaker 1: where we give you the top five business stories you 4 00:00:11,119 --> 00:00:13,280 Speaker 1: need to know. And it's five minutes. I'm Michael Thompson 5 00:00:13,320 --> 00:00:14,640 Speaker 1: and good morning Sean Aylmer. 6 00:00:14,840 --> 00:00:16,640 Speaker 2: Good morning Michael, Sean. 7 00:00:16,720 --> 00:00:19,120 Speaker 1: Five stories, five minutes. Let's go a story number one. 8 00:00:19,120 --> 00:00:22,160 Speaker 1: Australia's big four banks made a combined fifteen point three 9 00:00:22,239 --> 00:00:25,520 Speaker 1: billion dollars in their half year reporting season, a solid 10 00:00:25,560 --> 00:00:29,720 Speaker 1: if unspectacular result, particularly given the run in their share prices. 11 00:00:29,400 --> 00:00:31,600 Speaker 2: So Westpac, National, Australian Bank and A and Z reported 12 00:00:31,680 --> 00:00:34,080 Speaker 2: last week. Commonwealth Bank, which has a different balanced state, 13 00:00:34,159 --> 00:00:36,920 Speaker 2: reported it's half year profit in February. Common Wealth Bank 14 00:00:36,960 --> 00:00:40,400 Speaker 2: did actually report a third quarter profit yesterday, up six 15 00:00:40,440 --> 00:00:43,960 Speaker 2: percent two point six billion dollars. Basically, you know, good result. 16 00:00:44,320 --> 00:00:46,960 Speaker 2: Bit of a boost in spending though as a result 17 00:00:47,000 --> 00:00:49,320 Speaker 2: of staff and technology. But if you put the big 18 00:00:49,360 --> 00:00:53,200 Speaker 2: four half year profits together, they're basically flat. In fact, 19 00:00:53,159 --> 00:00:58,040 Speaker 2: they're up zero point one percent. Net interest margins, effectively 20 00:00:58,160 --> 00:01:02,160 Speaker 2: the bank's profit margin. We're steady. Now. Banks prefer to 21 00:01:02,200 --> 00:01:04,760 Speaker 2: fund their loans via deposits because they're cheaper. The level 22 00:01:04,800 --> 00:01:08,760 Speaker 2: of deposits funding loans is at a ten year high. 23 00:01:09,440 --> 00:01:11,440 Speaker 2: So if you think one side is at a ten 24 00:01:11,520 --> 00:01:15,120 Speaker 2: year high, yet your profit margin is flat, the other side, 25 00:01:15,280 --> 00:01:18,840 Speaker 2: the cost side is clearly a little too high. While 26 00:01:18,840 --> 00:01:20,640 Speaker 2: some of the heat has come out of the mortgage market, 27 00:01:20,720 --> 00:01:23,080 Speaker 2: meaning customers might not be getting as good as deals 28 00:01:23,200 --> 00:01:26,679 Speaker 2: as they had previously, the business lending market is definitely 29 00:01:26,720 --> 00:01:29,600 Speaker 2: warming up right now. The thing in that market the 30 00:01:29,600 --> 00:01:32,000 Speaker 2: big banks aren't keeping up with smaller lenders in terms 31 00:01:32,040 --> 00:01:35,280 Speaker 2: of business spending growth spending growth Michael and Shan. 32 00:01:35,319 --> 00:01:38,520 Speaker 1: While the big four banks and zed Comnwealth, NAB Westpac 33 00:01:38,760 --> 00:01:41,560 Speaker 1: are obviously competing fiercely with each other, it does seem 34 00:01:41,600 --> 00:01:44,640 Speaker 1: like customers are increasingly looking elsewhere. 35 00:01:44,880 --> 00:01:46,800 Speaker 2: So the options for customers are greater now than ever, 36 00:01:46,840 --> 00:01:50,240 Speaker 2: and according to report from PwC, the propensity to change 37 00:01:50,240 --> 00:01:54,520 Speaker 2: banks is markedly higher for younger demographics. Gen Z Millennials 38 00:01:54,600 --> 00:01:56,720 Speaker 2: much more likely to consider non banks for their core 39 00:01:56,760 --> 00:02:00,760 Speaker 2: banking services compared to older generations. That ups the pressure 40 00:02:00,800 --> 00:02:02,840 Speaker 2: on the banks even more. If you look at the 41 00:02:02,840 --> 00:02:05,760 Speaker 2: bank's share prices so far this year, Comonwealth Bank's done 42 00:02:05,800 --> 00:02:09,239 Speaker 2: really well. It's up eight percent. The others are flat 43 00:02:09,520 --> 00:02:13,240 Speaker 2: or down, So maybe investors are reading between the lines 44 00:02:13,280 --> 00:02:15,000 Speaker 2: and seeing what's happening with the sector. 45 00:02:15,840 --> 00:02:17,440 Speaker 1: Seawan story number two. I've been keeping it eye on 46 00:02:17,480 --> 00:02:19,240 Speaker 1: the wage price index. Do you mind if I take 47 00:02:19,280 --> 00:02:19,839 Speaker 1: you through that one? 48 00:02:19,960 --> 00:02:23,480 Speaker 2: Ah? Economist Michael Thompson, Please can't wait? 49 00:02:23,520 --> 00:02:27,560 Speaker 1: All right, budding economists, here we go. Annual wages growth 50 00:02:27,639 --> 00:02:30,560 Speaker 1: increase to three point four percent in the March quarter 51 00:02:30,600 --> 00:02:33,280 Speaker 1: from three point two percent in December. The quarterly rate 52 00:02:33,480 --> 00:02:36,600 Speaker 1: was up zero point nine percent. The jump was in 53 00:02:36,680 --> 00:02:39,320 Speaker 1: part due to the first installment of pay rises for 54 00:02:39,440 --> 00:02:42,000 Speaker 1: aged care and childcare workers following a ruling by the 55 00:02:42,080 --> 00:02:45,200 Speaker 1: Fairwork Commission, which we talked about previously. Now economists say 56 00:02:45,240 --> 00:02:47,480 Speaker 1: that it won't be enough to stop the Reserve Bank 57 00:02:47,520 --> 00:02:50,760 Speaker 1: cutting interest rates by twenty five basis points when it 58 00:02:50,760 --> 00:02:54,280 Speaker 1: meets next week. According to the Financial Review, that's because 59 00:02:54,360 --> 00:02:58,880 Speaker 1: there's little evidence that wage rises are increasing outside jobs 60 00:02:59,120 --> 00:03:02,040 Speaker 1: where the Fairwork Commission and the government had intervened. But 61 00:03:02,080 --> 00:03:05,680 Speaker 1: they're also warning that the generous government funded wage rises 62 00:03:05,720 --> 00:03:08,519 Speaker 1: in these low paid jobs can't really be sustained without 63 00:03:08,600 --> 00:03:12,160 Speaker 1: improvements in productivity. So a very interesting one to watch. 64 00:03:12,200 --> 00:03:16,200 Speaker 1: Their story Number three. Local wine exports are rising thanks 65 00:03:16,200 --> 00:03:19,160 Speaker 1: to big demand from China, but what we're selling overseas 66 00:03:19,200 --> 00:03:20,320 Speaker 1: has changed quite a bit. 67 00:03:20,960 --> 00:03:23,160 Speaker 2: In total, we export about six hundred and forty seven 68 00:03:23,160 --> 00:03:25,360 Speaker 2: million leaders of wine each year. At least that was 69 00:03:25,400 --> 00:03:27,600 Speaker 2: for the twelve months to the end of March. Overseas 70 00:03:27,600 --> 00:03:30,959 Speaker 2: buyers are loving our reds less out white. The top 71 00:03:31,040 --> 00:03:34,960 Speaker 2: ridal according to Wine Australia is Chiraz or Shara, depending 72 00:03:35,000 --> 00:03:37,040 Speaker 2: where you come from. Sales are up twenty five percent 73 00:03:37,040 --> 00:03:39,640 Speaker 2: in the last year, whereas the number two export, Chardonnagum 74 00:03:39,720 --> 00:03:42,560 Speaker 2: was down five percent. Number three capsav up thirteen percent. 75 00:03:42,640 --> 00:03:47,520 Speaker 2: Number four pinogree slash Guzzio down ten percent. The interesting trend. 76 00:03:47,680 --> 00:03:50,080 Speaker 2: We sell a lot of expensive wines think pen files, 77 00:03:50,160 --> 00:03:52,400 Speaker 2: lots of cheap wine under five bucks a bottle, not 78 00:03:52,520 --> 00:03:53,920 Speaker 2: much in between a story. 79 00:03:54,040 --> 00:03:57,320 Speaker 1: Number four. Australian cattle prices have hit their highest level 80 00:03:57,320 --> 00:03:59,920 Speaker 1: of more than two years, helped by favorable rainfall and 81 00:04:00,080 --> 00:04:02,640 Speaker 1: heightened trade tensions between the US and China. 82 00:04:02,720 --> 00:04:04,480 Speaker 2: As you know today, Mike c li Ime riding from 83 00:04:04,520 --> 00:04:07,720 Speaker 2: Burke to Coba as part of a charity Royal Far 84 00:04:07,800 --> 00:04:11,160 Speaker 2: West raising money for country kids. Therefore very interested in 85 00:04:11,160 --> 00:04:14,080 Speaker 2: what's happening in rural Australia. The Eastern States Young Cattle 86 00:04:14,160 --> 00:04:17,120 Speaker 2: indicator climbed to seven dollars two a kilogram last week, 87 00:04:17,200 --> 00:04:19,640 Speaker 2: highest level since March twenty twenty three. According to Meat 88 00:04:19,680 --> 00:04:22,440 Speaker 2: and Live Stock Australia. It's double what it was in 89 00:04:22,520 --> 00:04:25,520 Speaker 2: late twenty twenty three. Basically, rainfall in parts of Queensland 90 00:04:25,600 --> 00:04:29,039 Speaker 2: and New South Wales have improved pastures. Also, more buyers 91 00:04:29,040 --> 00:04:32,200 Speaker 2: out there from processes the feed lots to graziers. The 92 00:04:32,240 --> 00:04:35,840 Speaker 2: two big consumers of beef, US and China a lot 93 00:04:35,839 --> 00:04:37,239 Speaker 2: of strong demand from them as well. 94 00:04:37,520 --> 00:04:40,839 Speaker 1: Last one story number five, Microsoft will cut three percent 95 00:04:40,960 --> 00:04:44,080 Speaker 1: of its global workforce as it seeks to cut costs 96 00:04:44,400 --> 00:04:46,440 Speaker 1: and pair back layers of middle management. 97 00:04:46,640 --> 00:04:49,040 Speaker 2: It's the latest round of job cuts at big tech companies, 98 00:04:49,080 --> 00:04:52,000 Speaker 2: with both Amazon and Meta in the process of dropping 99 00:04:52,120 --> 00:04:55,640 Speaker 2: thousands of rolls. Microsoft will cut around six thousand jobs, 100 00:04:55,680 --> 00:04:59,080 Speaker 2: including an international officers and wholly owned subsidiaries such as LinkedIn. 101 00:04:59,360 --> 00:05:01,800 Speaker 2: It follows BEFO performance related job cuts this year that 102 00:05:01,839 --> 00:05:05,279 Speaker 2: affected two thousand Microsoft employees. And tech companies are balancing 103 00:05:05,320 --> 00:05:09,679 Speaker 2: their workforce needs and costs against big investments in artificial intelligence. Also, 104 00:05:09,720 --> 00:05:13,679 Speaker 2: greater competition from startups think open Ai. Meta, for example, 105 00:05:13,760 --> 00:05:17,600 Speaker 2: branded about five percent of the company's low performers before 106 00:05:17,640 --> 00:05:20,960 Speaker 2: then firing them earlier this year. Over the past few years, 107 00:05:21,040 --> 00:05:23,719 Speaker 2: Mesas reduced its workforce by around twenty five percent. 108 00:05:23,880 --> 00:05:25,800 Speaker 1: There we go to the top five business stories in 109 00:05:25,880 --> 00:05:28,520 Speaker 1: five minutes. Thank you Sean, and good luck today on 110 00:05:28,560 --> 00:05:30,680 Speaker 1: the first leg of the ride for country Kids. 111 00:05:30,920 --> 00:05:32,039 Speaker 2: Thank you Michael. Thank you. 112 00:05:32,320 --> 00:05:34,200 Speaker 1: If you're able to donate, please there's a link in 113 00:05:34,240 --> 00:05:36,560 Speaker 1: today's show notes and all the money raised is going 114 00:05:36,600 --> 00:05:39,720 Speaker 1: to help kids in rural and regional Australia to get 115 00:05:39,720 --> 00:05:42,640 Speaker 1: better opportunities in life. The link is there and please 116 00:05:42,720 --> 00:05:45,000 Speaker 1: give generously. It is Thursday, the fifteenth of May twenty 117 00:05:45,040 --> 00:05:47,200 Speaker 1: twenty five, remembered hit follow on the podcast and if 118 00:05:47,200 --> 00:05:49,400 Speaker 1: five minutes isn't enough, you can find our longer daily 119 00:05:49,440 --> 00:05:52,120 Speaker 1: show called Fear and Greed where if you listen to podcasts, 120 00:05:52,200 --> 00:05:54,320 Speaker 1: I'm Michael Thompson and that was the fast five business 121 00:05:54,320 --> 00:05:56,480 Speaker 1: news by Fear and Greed. Have a great day.