RBA Gov. Bullock Continues to Rule Out Near-Term Interest Rate Cuts
The remarks suggest the central bank will lag well behind its global counterparts in cutting interest rates
The remarks suggest the central bank will lag well behind its global counterparts in cutting interest rates
SYDNEY—The Reserve Bank of Australia has ruled out the prospect of near-term interest rate cuts as it remains wary of upside risks to inflation which has proved more resilient than expected.
The central bank Gov. Michele Bullock told a parliamentary committee Friday that while money markets were anticipating an interest-rate cut before the end of the year, the probability of that was low.
The RBA’s board’s message after its recent policy meeting “was that it is premature to be thinking about rate cuts,” she said.
“Inflation is still too high and, in underlying terms, is not expected to be back in the top of the band until the end of next year,” Bullock said.
While circumstances could change, the outlook was uncertain, and based on what the board knows at present, it doesn’t expect to be in a position to cut rates in the near term, Bullock said.
Bullock’s comments are expected to disappoint home buyers who are struggling under the weight of elevated interest rates and immense debt.
The remarks also suggest that the RBA will lag well behind its global counterparts in cutting interest rates.
The RBA has held the official cash rate at 4.35% since November, having begun an aggressive tightening cycle back in May 2022, when the OCR was sitting at an emergency low of 0.10%.
Still, the RBA adopted a much gentler approach to raising interest rates than most of its G-10 counterparts, arguing that protecting employment was a key policy goal.
“I understand that this is not what many households want to hear. Those with mortgages are feeling the squeeze on their cash flows from the increase in interest rates over the past couple of years. Businesses too are facing higher borrowing costs. But the alternative of higher inflation for longer is much worse,” Bullock added.
This stylish family home combines a classic palette and finishes with a flexible floorplan
Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.
“Only with competition can we become stronger and allow the industry to remain healthy,” Ma said
Alibaba Group co-founder Jack Ma said competition will make the company stronger and the e-commerce giant needs to trust in the power of market forces and innovation, according to an internal memo to commemorate the company’s 25th anniversary.
“Many of Alibaba’s business face challenges and the possibility of being surpassed, but that’s to be expected as no single company can stay at the top forever in any industry,” Ma said in a letter sent to employees late Tuesday, seen by The Wall Street Journal.
Once a darling of Wall Street and the dominant player in China’s e-commerce industry, the tech giant’s growth has slowed amid a weakening Chinese economy and subdued consumer sentiment. Intensifying competition from homegrown upstarts such as PDD Holdings ’ Pinduoduo e-commerce platform and ByteDance’s short-video app Douyin has also pressured Alibaba’s growth momentum.
“Only with competition can we become stronger and allow the industry to remain healthy,” Ma said.
The letter came after Alibaba recently completed a three-year regulatory process in China.
Chinese regulators said in late August that they have completed their monitoring and evaluation of Alibaba after the company was penalized over monopolistic practices in 2021. Over the past three years, the company has been required to submit self-evaluation compliance reports to market regulators.
Ma reiterated Alibaba’s ambition of being a company that can last 102 years. He urged Alibaba’s employees to not flounder in the midst of challenges and competition.
“The reason we’re Alibaba is because we have idealistic beliefs, we trust the future, believe in the market. We believe that only a company that can create real value for society can keep operating for 102 years,” he said.
Ma himself has kept a low profile since late 2020 when financial affiliate Ant Group called off initial public offerings in Hong Kong and Shanghai that had been on track to raise more than $34 billion.
In a separate internal letter in April, he praised Alibaba’s leadership and its restructuring efforts after the company split the group into six independently run companies.
Alibaba recently completed the conversion of its Hong Kong secondary listing into a primary listing, and on Tuesday was added to a scheme allowing investors in mainland China to trade Hong Kong-listed shares.
Alibaba shares fell 1.2% to 80.60 Hong Kong dollars, or equivalent of US$10.34, by midday Wednesday, after rising 4.2% on Tuesday following the Stock Connect inclusion. The company’s shares are up 6.9% so far this year.
This stylish family home combines a classic palette and finishes with a flexible floorplan
Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.