1 00:00:05,200 --> 00:00:07,240 Speaker 1: Welcome to Fear and Greed the week Ahead. I'm Sean 2 00:00:07,280 --> 00:00:10,360 Speaker 1: Almer and as always I'm joined by economist Stephen Coocoulis. 3 00:00:10,400 --> 00:00:12,480 Speaker 1: You'll find him at the Cook dot com, t h 4 00:00:12,560 --> 00:00:16,960 Speaker 1: e kuk dot com and on X using the handle 5 00:00:17,000 --> 00:00:17,800 Speaker 1: the Kirk Stephen. 6 00:00:17,840 --> 00:00:19,560 Speaker 2: Good morning, be good morning Sean. 7 00:00:20,160 --> 00:00:24,560 Speaker 1: We have Anthony Albanizi returning as Prime minister. What should 8 00:00:24,680 --> 00:00:26,840 Speaker 1: he be looking at over the next three years. 9 00:00:27,120 --> 00:00:30,640 Speaker 2: Yeah, Well, from the election campaign and the policy roll out, 10 00:00:30,680 --> 00:00:33,760 Speaker 2: I suppose from the Labor Party it's pretty much business 11 00:00:33,800 --> 00:00:37,280 Speaker 2: as usual. There's the small income tax cuts that have 12 00:00:37,280 --> 00:00:41,640 Speaker 2: been legislated, there's the sort of housing policies, a range 13 00:00:41,680 --> 00:00:43,760 Speaker 2: of other sort of odds and ends that are out 14 00:00:43,800 --> 00:00:48,240 Speaker 2: there for them to implement. But I think on forming 15 00:00:48,280 --> 00:00:51,080 Speaker 2: government having had to look at the fiscal position, the 16 00:00:51,120 --> 00:00:54,000 Speaker 2: budget issues, you know, the standard pause warning. While I 17 00:00:54,040 --> 00:00:57,040 Speaker 2: don't think that's sort of top of the list of 18 00:00:57,080 --> 00:01:00,640 Speaker 2: worries to have the government looking into, it is somewhere there. 19 00:01:00,680 --> 00:01:03,920 Speaker 2: And I think that even though the Treasurer and financi 20 00:01:03,960 --> 00:01:05,800 Speaker 2: mist and need a little bit of a bit of 21 00:01:05,800 --> 00:01:10,080 Speaker 2: a rest after the election campaigning, if they do have 22 00:01:10,319 --> 00:01:14,880 Speaker 2: some form of economic statement, a mini budget around September October, 23 00:01:15,440 --> 00:01:17,560 Speaker 2: it'd be wise for them just to sort of look 24 00:01:17,600 --> 00:01:21,000 Speaker 2: at where they can possibly trim some spending, where they 25 00:01:21,040 --> 00:01:23,479 Speaker 2: could possibly look for a little bit of extra revenue, 26 00:01:23,760 --> 00:01:27,720 Speaker 2: just so that these budget deficits, which are not a worry, 27 00:01:27,760 --> 00:01:28,960 Speaker 2: but you'd prefer them to be a bit a little 28 00:01:28,959 --> 00:01:30,680 Speaker 2: bit smaller than a little bit bigger, put it that way. 29 00:01:30,680 --> 00:01:32,919 Speaker 2: And I think that's what I'd be doing if ols elbow, 30 00:01:33,040 --> 00:01:35,800 Speaker 2: I'd be getting on the phone if you can, to 31 00:01:35,880 --> 00:01:38,600 Speaker 2: Trump and g and talk about a whole lot of 32 00:01:38,600 --> 00:01:43,040 Speaker 2: issues to the robbies there on tariffs, on geopolitics, on 33 00:01:43,280 --> 00:01:46,560 Speaker 2: international trade relationships and the like, and do a little 34 00:01:46,560 --> 00:01:49,280 Speaker 2: bit of a foreign push to make sure that Australia 35 00:01:49,280 --> 00:01:51,800 Speaker 2: hasn't been forgotten in this sort of tumult that we've 36 00:01:51,800 --> 00:01:53,000 Speaker 2: seen in the last couple of months. 37 00:01:53,680 --> 00:01:55,560 Speaker 1: Okay, we've got rid of politics. Now we don't have 38 00:01:55,560 --> 00:01:57,440 Speaker 1: to talk about it anymore for a while. It's always 39 00:01:57,440 --> 00:02:00,200 Speaker 1: a big relief alfter the election. Less talk economics. So 40 00:02:00,280 --> 00:02:02,360 Speaker 1: much going on, I mean, a big week this week, 41 00:02:02,360 --> 00:02:05,040 Speaker 1: but let's start with those inflation numbers last week. What 42 00:02:05,080 --> 00:02:05,720 Speaker 1: did you make of them? 43 00:02:05,840 --> 00:02:09,519 Speaker 2: Yep, all pretty good. Yeah, we looked at the headlined figure, 44 00:02:09,639 --> 00:02:13,200 Speaker 2: the trimmed mean figure on a quarterly basis, on a 45 00:02:13,280 --> 00:02:16,880 Speaker 2: monthly basis, and they're all two points something. The headline 46 00:02:16,880 --> 00:02:19,360 Speaker 2: figures are a two point four, the trimmed mean on 47 00:02:19,400 --> 00:02:21,800 Speaker 2: the quarterly basis two point nine, on a monthly basis 48 00:02:21,840 --> 00:02:24,720 Speaker 2: two point seven. And as we know now, and it's 49 00:02:24,800 --> 00:02:27,880 Speaker 2: drumming to everybody, that the inflation targets between two and three. 50 00:02:28,000 --> 00:02:32,520 Speaker 2: So all measures are on target, in target, and the 51 00:02:32,600 --> 00:02:35,920 Speaker 2: trajectory is either flat or slightly lower, particularly for the 52 00:02:35,919 --> 00:02:38,760 Speaker 2: trimmed mean measures, because we've got a couple of big 53 00:02:39,000 --> 00:02:41,839 Speaker 2: results dropping out of the next quarterly run rate they've 54 00:02:41,840 --> 00:02:43,280 Speaker 2: got I think we've got a one percent dropping out. 55 00:02:43,320 --> 00:02:45,919 Speaker 2: So even if we get just say another point six 56 00:02:45,960 --> 00:02:48,680 Speaker 2: point seven something like that for the trimmed mean, we're 57 00:02:48,720 --> 00:02:50,560 Speaker 2: going to be getting to two and a half. Sort 58 00:02:50,560 --> 00:02:53,200 Speaker 2: of as just a mechanical exercise on how these things 59 00:02:53,200 --> 00:02:55,960 Speaker 2: are working. That looks fair enough. So what does it 60 00:02:56,000 --> 00:02:58,960 Speaker 2: mean which not everybody's loo Yes, rate cups yes. So 61 00:02:59,040 --> 00:03:01,040 Speaker 2: later this month, on the twentieth of May, when the 62 00:03:01,120 --> 00:03:05,280 Speaker 2: RBA gets back together again and has a look at 63 00:03:05,320 --> 00:03:07,440 Speaker 2: these numbers, and we've got another unemployment number to come 64 00:03:07,480 --> 00:03:09,520 Speaker 2: before that meeting just by the way, and a wage's 65 00:03:09,560 --> 00:03:13,680 Speaker 2: number that's two weeks hence roughly, that'll be really important 66 00:03:13,720 --> 00:03:15,440 Speaker 2: to sort of see whether the twenty five is just 67 00:03:15,440 --> 00:03:18,919 Speaker 2: to twenty five, which is the current overwhelming Consensu's not 68 00:03:18,960 --> 00:03:21,480 Speaker 2: the unanimous use. Some people are out there on fifty. 69 00:03:21,760 --> 00:03:24,840 Speaker 2: But if we get sort of the wage numbers continuing 70 00:03:24,880 --> 00:03:27,919 Speaker 2: to decelerate a little bit, if we get the next 71 00:03:28,000 --> 00:03:30,040 Speaker 2: employment labor force numbers showing a little bit of an 72 00:03:30,080 --> 00:03:33,240 Speaker 2: upturn and unemployment, then what depends what happens globally a 73 00:03:33,240 --> 00:03:36,440 Speaker 2: bit too fifty is not impossible at. 74 00:03:36,280 --> 00:03:39,440 Speaker 1: This stage, right it did very quickly before we get 75 00:03:39,480 --> 00:03:42,160 Speaker 1: onto this week. Last week's house prices, it's not like 76 00:03:42,200 --> 00:03:44,760 Speaker 1: it's booming, but I mean prices are still rising. 77 00:03:44,680 --> 00:03:47,520 Speaker 2: Up point three percent, and regional parts of the country 78 00:03:47,560 --> 00:03:49,840 Speaker 2: are doing better than most of the capital cities. And 79 00:03:49,840 --> 00:03:53,000 Speaker 2: the interesting about thinking about the capital cities, putting dah 80 00:03:53,120 --> 00:03:55,240 Speaker 2: on the side just from up because it was very strong, 81 00:03:55,520 --> 00:03:57,520 Speaker 2: having had a period of weakness in the last year. 82 00:03:58,040 --> 00:04:01,000 Speaker 2: There's a convergence that when we're talking house prices six 83 00:04:01,000 --> 00:04:04,920 Speaker 2: and twelve months ago, you know, it was Adelaide, Perth, Brisbane, 84 00:04:04,960 --> 00:04:07,080 Speaker 2: there were booming, and it was Melbourne was a laggard, 85 00:04:07,120 --> 00:04:09,920 Speaker 2: and Hobart was down and canber and Sydney was starting 86 00:04:09,920 --> 00:04:11,880 Speaker 2: to weaken at the end of last year earlier this year. 87 00:04:12,440 --> 00:04:14,680 Speaker 2: Now that's changed and they're all sort of like growing 88 00:04:14,680 --> 00:04:17,080 Speaker 2: at a point two point three point four per month, 89 00:04:17,560 --> 00:04:21,839 Speaker 2: about one percent per quarter. So there's been that convergence. 90 00:04:21,839 --> 00:04:26,560 Speaker 2: So housing, you know, doing okay and consolidating a little 91 00:04:26,560 --> 00:04:30,520 Speaker 2: bit in terms of prices. But it's probably a nice 92 00:04:30,560 --> 00:04:32,120 Speaker 2: thing that we're getting a bit of a house price 93 00:04:32,160 --> 00:04:35,200 Speaker 2: correction without there being house price crashes, because that's the 94 00:04:35,200 --> 00:04:38,559 Speaker 2: best way to improve affordability. Small increases in prices, bigger 95 00:04:38,600 --> 00:04:42,160 Speaker 2: increases in wages, a structural lowering in interest rates. Way, 96 00:04:42,160 --> 00:04:46,000 Speaker 2: if your magic one to abracadabra outcomes better affordability, excellent. 97 00:04:46,040 --> 00:04:48,440 Speaker 1: Now this week we've got a bunch of partial indicators. 98 00:04:48,480 --> 00:04:50,560 Speaker 1: The one I like, well, you've told me to like 99 00:04:50,600 --> 00:04:53,000 Speaker 1: it because I like retail trade, But it's about household 100 00:04:53,000 --> 00:04:55,520 Speaker 1: spending nowadays, what do you expect from. 101 00:04:55,360 --> 00:04:58,200 Speaker 2: That your household spending? As we've discussed in the past, 102 00:04:58,200 --> 00:05:01,520 Speaker 2: it's the new it's retail re our trade plus plus 103 00:05:01,880 --> 00:05:05,480 Speaker 2: two point zero because it's retail trade plus a bunch 104 00:05:05,480 --> 00:05:07,919 Speaker 2: of other things that are part of household spending that 105 00:05:07,960 --> 00:05:10,279 Speaker 2: weren't in the retail sales numbers. So there's a whole 106 00:05:10,279 --> 00:05:12,120 Speaker 2: bunch of services and bits and bobs that are in 107 00:05:12,120 --> 00:05:13,880 Speaker 2: there now. But it's roughly double the size of the 108 00:05:13,920 --> 00:05:17,520 Speaker 2: old retail sales release. So all that aside, what we've 109 00:05:17,520 --> 00:05:21,599 Speaker 2: got will be the March numbers, probably an increase of 110 00:05:21,640 --> 00:05:24,760 Speaker 2: about zero point four percent in the month. We've had 111 00:05:24,760 --> 00:05:27,600 Speaker 2: a bit of volatility in that monthly reading over November, 112 00:05:27,600 --> 00:05:32,040 Speaker 2: December January, partly from Black Friday sales, remember them, New 113 00:05:32,160 --> 00:05:35,359 Speaker 2: Year Christmas and the sort of seasonal adjustment problems that 114 00:05:35,400 --> 00:05:37,480 Speaker 2: the AVS has. Now we're back probably on to where 115 00:05:37,839 --> 00:05:40,920 Speaker 2: the true month on month figures are so a small increase. 116 00:05:41,080 --> 00:05:43,680 Speaker 2: You know, we consume as a you know, feeling a 117 00:05:43,720 --> 00:05:46,560 Speaker 2: little bit better, we're spending a little bit more. Inflation's 118 00:05:46,600 --> 00:05:49,320 Speaker 2: come down, wages are up a bit, so that spending 119 00:05:49,400 --> 00:05:53,200 Speaker 2: number will be mildly positive, and you know the risks 120 00:05:53,200 --> 00:05:55,120 Speaker 2: around that, of course, because it's such a new survey, 121 00:05:55,120 --> 00:05:57,520 Speaker 2: we're not exactly sure how to be more confident with 122 00:05:57,560 --> 00:05:58,360 Speaker 2: our forecasts. 123 00:05:58,520 --> 00:06:00,559 Speaker 1: Fair enough, building approvals, what's having in that section? 124 00:06:00,760 --> 00:06:04,559 Speaker 2: Yeah, well, that's been a sleeper. It's actually up twenty 125 00:06:04,600 --> 00:06:08,080 Speaker 2: seven percent in the last year, admittedly from a horrendously 126 00:06:08,120 --> 00:06:11,400 Speaker 2: low base, and all about housing supply. Supply, supply, we 127 00:06:11,400 --> 00:06:13,480 Speaker 2: need to see more supplies. So there's sort of again 128 00:06:13,600 --> 00:06:17,120 Speaker 2: some encouraging news on building approvals that said, the market's 129 00:06:17,160 --> 00:06:18,440 Speaker 2: looking for a bit of a dit because we've had 130 00:06:18,440 --> 00:06:20,640 Speaker 2: a couple of very strong months and you know the 131 00:06:20,680 --> 00:06:23,720 Speaker 2: apartment approvals. If you get an apartment tower of five 132 00:06:23,800 --> 00:06:26,440 Speaker 2: hundred one thousand units, that the storts a month on 133 00:06:26,480 --> 00:06:29,000 Speaker 2: a month figure, so we'd probably do for a zag 134 00:06:29,080 --> 00:06:31,440 Speaker 2: rather than a zig. So probably down a couple of percent, 135 00:06:31,520 --> 00:06:33,680 Speaker 2: but the trend is still pretty good. We're still sort 136 00:06:33,680 --> 00:06:36,720 Speaker 2: of getting this early stages of a house building recovery, 137 00:06:37,200 --> 00:06:39,800 Speaker 2: which is sort of nice to see and exactly what 138 00:06:39,839 --> 00:06:41,960 Speaker 2: we need to fix this housing and affordability issue again. 139 00:06:42,600 --> 00:06:44,240 Speaker 1: Job ads, Steven, job ads. 140 00:06:44,080 --> 00:06:47,200 Speaker 2: Job ads, job ads, jobs that's well, they've been weak. 141 00:06:47,279 --> 00:06:49,840 Speaker 2: They're the one part of the economy that's been subdued. 142 00:06:49,960 --> 00:06:52,840 Speaker 2: So we'll watch that for any further signs of whether 143 00:06:52,880 --> 00:06:56,160 Speaker 2: there's a bit of a pullback in hiring intentions consistent 144 00:06:56,200 --> 00:06:58,480 Speaker 2: with a calling in the labor market. So important to 145 00:06:58,520 --> 00:06:59,760 Speaker 2: have a look at that because it's a nice leading 146 00:06:59,760 --> 00:07:00,839 Speaker 2: in the cater for employment. 147 00:07:01,080 --> 00:07:03,680 Speaker 1: And a couple of overseas central banks make decisions on 148 00:07:03,720 --> 00:07:04,599 Speaker 1: interest rates as well. 149 00:07:04,960 --> 00:07:07,920 Speaker 2: Our friends at the Fed, but no change expected there, 150 00:07:07,920 --> 00:07:10,400 Speaker 2: which will probably cause mister Trump to be very cross. 151 00:07:10,760 --> 00:07:13,560 Speaker 2: If a Drome Powell sits on his hand, he won't 152 00:07:13,600 --> 00:07:15,680 Speaker 2: be happy. And then we've got the Bank of England, 153 00:07:15,720 --> 00:07:18,080 Speaker 2: but they're likely to cut interest rates, such as the 154 00:07:18,680 --> 00:07:21,920 Speaker 2: other ports of the UK economy. So one cut us 155 00:07:21,920 --> 00:07:26,240 Speaker 2: on hold and yeah, we've got a three years to 156 00:07:26,320 --> 00:07:26,920 Speaker 2: the next election. 157 00:07:27,160 --> 00:07:28,640 Speaker 1: Thank god, did even enjoy the week? 158 00:07:29,080 --> 00:07:29,560 Speaker 2: Thanks Sean. 159 00:07:29,760 --> 00:07:32,040 Speaker 1: That's economist Stephen Cocurl is better known as the Kok. 160 00:07:32,080 --> 00:07:34,040 Speaker 1: You can find him at the cook dot com and 161 00:07:34,160 --> 00:07:37,000 Speaker 1: follow him on excusing the handle of the Kok. I'm 162 00:07:37,040 --> 00:07:39,480 Speaker 1: Sean a Elmer and this is hearing greet the week Ahead.