RBA hikes rates, another expected; OpenAI apologises; Asian airlines win friends

RBA hikes rates, another expected; OpenAI apologises; Asian airlines win friends

News in brief

OpenAI apology: OpenAI has apologised after its AI agents accessed Australian government websites without authorisation during internal training. The company says it will work with Australian officials on stronger protections, while federal police continue examining the Medicare incident.

 

REA’s $409m Irish bet: REA Group is buying 35 per cent of Irish marketplace company Distilled, owner of leading property portals Daft and PropertyPal. It’s chief executive Cameron McIntyre’s first overseas acquisition at REA and follows the expansion strategy he used successfully at CAR Group.

 

Chobani v Bega: Chobani is spending about $20 million to enter Australia’s flavoured milk market, taking on Bega and its brands including Dare and Big M. The bet is partly about booming demand for protein-rich foods, a trend being accelerated by the rise of GLP-1 weight-loss drugs.

 

Asian airline winners: Australians heading to Europe are increasingly looking towards Asian carriers as Middle East disruption reshapes travel patterns. Flight Centre bookings for China Eastern surged 278 per cent between June and September, while China Airlines and Malaysia Airlines more than doubled.

 

Anthropic warning: A leaked Anthropic prospectus paints an extraordinary picture of the scale — and risks — of the AI boom. The company warns advanced models could pose “existential risks to humanity”, while outlining enormous spending plans as it pursues an IPO that could reportedly value it above $US2 trillion.

 

Nvidia record buyback: Nvidia’s board has approved another $US150 billion for share buybacks, taking its total authorisation to as much as $US235 billion before January 2028. That’s roughly $A335 billion — more than the entire market value of BHP.

Fear-o-meter

RBA Monetary Policy Board announcement:

 

“Since the previous meeting, some of the upside risks to inflation are materialising. There have been further disruptions to global oil supply and recent data suggest that growth and inflation in Australia have been higher than expected. Higher fuel prices have partially been passed through to prices of other goods and services. This inflation impulse is in addition to the effect of capacity pressures in the economy.

 

“The Board remains focused on ensuring that high inflation does not become embedded. To achieve this, growth in aggregate demand needs to remain subdued for a period to reduce capacity pressures and bring inflation back to target. The three increases in the cash rate target since the beginning of the year have tightened financial conditions and the economy appears to be slowing. But inflation is still too high and the Board judged that, in light of recent developments, a further tightening in financial conditions is warranted to support a return of inflation to target in a reasonable period.

 

“The Board will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed. Accordingly, the Board will be attentive to the data and the evolving assessment of the outlook and risks to guide its decisions. Monetary policy is well placed to respond to developments, and the Board is focused on its mandate to deliver price stability and full employment.

 

“Today’s policy decision was unanimous.”

Fear & Greed Q+A today

On the RBA's decision to increase interest rates, and whether the Australian economy could end up in recession:

 

“We could, and it doesn't take much. The difference between an economy growing at 0.3 or 0.4 a quarter, which is effectively what the RBA was forecasting in their most recent Statement on Monetary Policy — annual growth about 1.5 — and minus 0.1 for a couple of quarters is not that much.

 

“All it takes is consumers just to pare back their spending a little more, and perhaps some of the data centres to be postponed, or the construction thereof to be postponed. Maybe people sort of view the cost-of-living issue: ‘Well, I really would like a new car but I won't buy one yet. I'd really like to spend some money, have a nice holiday, but I can't. I'm paying my mortgage.’

 

“And that's where the risk comes. It's a very fine issue when you're on the brink of one. And we're sort of on the brink of one already.”

Australian mortgage holders have been hit with another increase in repayments after the Reserve Bank lifted the cash rate by 25 basis points to 4.6 per cent — the fourth increase this year.

 

The RBA warned rates could rise again if inflation isn’t brought sustainably back into the 2–3 per cent target band. But Governor Michele Bullock pushed back against market expectations for two more increases, helping shares recover and the Australian dollar retreat after the decision.

 

For borrowers, the impact is substantial. The latest increase adds about $110 a month to repayments on a $700,000 mortgage. Including this year’s previous increases, that loan is now costing roughly $5,300 more a year in interest.

 

Australia’s benchmark rate is now higher than those in the US, UK, the Euro area, New Zealand and Japan.

 

And households are already responding. Spending momentum slowed sharply in August as higher fuel prices squeezed budgets, with consumers cutting back on discretionary purchases.

Greed-o-meter

Rank	TV show	Years
1	Breaking Bad	2008–2013
2	The Wire	2002–2008
3	Mad Men	2007–2015
4	Succession	2018–2023
5	Fleabag	2016–2019
6	Game of Thrones	2011–2019
7	Veep	2012–2019
8	30 Rock	2006–2013
9	Curb Your Enthusiasm	2000–2024
10	Atlanta	2016–2022
11	The Office (U.S.)	2005–2013
12	Arrested Development	2003–2019
13	Girls	2012–2017
14	Friday Night Lights	2006–2011
15	Six Feet Under	2001–2005
16	The Office (U.K.)	2001–2003
17	The Americans	2013–2018
18	I May Destroy You	2020
19	Chernobyl	2019
20	The Crown	2016–2023

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A lot of talk today about interest rates - so here's a change of pace (though it may be even more controversial than the RBA). The New York Times has asked more than 500 actors, writers, directors, producers and other industry figures to rank the 100 best TV shows of the 21st century. This is the top 20, and there's plenty to agree and disagree with here. (I mean, Schitt's Creek belongs in the top ten, and it only made #34. Ted Lasso was #75. Ludicrous, right?)

Listen to today's episode 🎧 

Source: The New York Times