分类： business

Australian households holding mortgages are facing a stark new warning from the Reserve Bank of Australia (RBA): the central bank stands ready to resume interest rate hikes if persistent high inflation and emerging upside risks do not ease in the coming months.

Delivering remarks at the Queensland Futures Institute Annual Regions Summit in Brisbane, RBA Deputy Governor Andrew Hauser laid out the central bank’s position just one week after policymakers voted to hold the official cash rate steady at its August meeting. While the board opted to pause hikes for a second consecutive gathering, Hauser emphasized that the status quo is far from permanent, as inflation remains well above the RBA’s mandated target range.

“While we concluded last week that interest rates are okay where they are for now, we are worried about the inflationary outlook and we are worried about the upside risk to inflation,” Hauser told attendees.

Hauser outlined three key threats that could push inflation higher than current projections, derailing the central bank’s progress toward price stability. The first is the ongoing crisis in the Middle East, which carries significant risk of escalation that could drive global energy and supply chain costs upward. Second, the rapid, unexpected boom currently unfolding across the global technology sector threatens to import fresh inflationary pressure from international markets. Third, domestic constraints, including sluggish supply and weak productivity growth, remain a persistent concern for policymakers.

“If those upside risks to inflation crystallise and we don’t see inflation coming down, we will have to raise interest rates again and we will do so,” Hauser said.

The RBA’s August pause matched broad market expectations, following an aggressive tightening cycle so far in 2026. Across three of the five scheduled monetary policy meetings this year, the central bank has lifted the cash rate by a cumulative 75 basis points, pushing the benchmark from 3.60 percent to its current level of 4.35 percent. Since those three hikes, the RBA has opted to hold rates steady at back-to-back meetings to assess the cumulative impact of previous tightening on the economy.

Current inflation data underscores the challenge facing the RBA. The central bank’s preferred trimmed mean inflation measure, which excludes the most volatile 15 percent of price movements in both directions, came in at 3.60 percent for the 12-month period ending in June. That reading remains noticeably above the RBA’s statutory target range of 2 to 3 percent.

Hauser reiterated the central bank’s dual mandate: returning inflation to the 2-3 percent target while sustaining full employment for Australian workers. He emphasized that stubbornly high inflation remains the most pressing threat to household and economic stability, noting that cost-of-living pressures are being felt across the country, even if some inflationary pressure originates outside Australia’s borders.

“Our message is simple, inflation is too high,” he said. “Everywhere you look people say prices are too high, cost pressures are too strong and while some of that is not home grown … but some of it does come from Australia.”

The deputy governor also acknowledged that bringing inflation back to target will require a period of below-trend economic growth, pushing back against expectations that the RBA can achieve price stability without any cooling in domestic activity. He explained that monetary policy works by tempering excess demand and capacity pressure in the economy, a process that inevitably translates to slower consumption and employment growth than Australia has seen in recent years.

“Monetary policy needs to bring inflation down, that is why we have raised rates three times this year, but here is the bad bit, it can only do so by reducing pressure on capacity and demand on the economy,” he said. “That means slightly slower growth in consumption, slightly slower growth in employment. We’ve seen a little bit of that so far, but we are going to need to see more to get inflation back.”

Hauser was quick to clarify that the projected slowdown is not a forecast for a deep recession or depression, stressing that the central bank expects only a moderate cooling of activity as inflation adjusts back to target. “That is not a slump, that is not a depression … but it is slower than growth in the past,” he added.

An unprecedented statistical anomaly, a outcome not seen in nearly half a century, has delivered a significant financial hit to Australia’s The Lottery Corporation, eroding millions in top-line revenue and driving a more than one-fifth drop in annual after-tax profits.

The firm released its full-year financial results on Wednesday, revealing that the past 12 months marked the first time in five years that no $100 million Powerball jackpot was awarded, and the first stretch of nine years without a $50 million Powerball draw. This unusual gap in mega-jackpot draws drained $350 million from the company’s annual revenue, executives confirmed.

Wayne Pickup, chief executive officer of The Lottery Corporation, described the absence of these high-value jackpots as a one-in-45-year statistical event. Despite the sharp hit to the bottom line, Pickup emphasized that the company’s core operations delivered solid performance across metrics the business can directly control.

“Where we control the levers, we performed well, with healthy retention of price increases in our two largest games – Powerball and Saturday lotto – and continued growth in base games and Keno,” Pickup said in a statement accompanying the results. The CEO added that the company’s approach to cost control is a permanent structural adjustment, not a temporary one-off fix, freeing up capital to reinvest in key growth areas including digital infrastructure, artificial intelligence integration, new product development, and customer experience capabilities.

Large jackpot draws are inherently variable in outcome, Pickup explained, noting that these fluctuations typically even out over longer time periods. For the full fiscal year, total revenue for The Lottery Corporation dipped 2.7% year-over-year to $3.58 billion, while after-tax profits fell 22.1% to $284.6 million.

The financial damage from the lack of mega-jackpots was partially offset by a November price increase for Powerball tickets, which boosted margins and revenue. Long-term prospects for the business also received a boost earlier this year, when the company secured a 40-year extension of its lottery license with the state of Victoria, locking in operating rights for decades to come.

For shareholders, the company maintained its dividend payout, approving a total fully franked ordinary dividend of 16 cents per share – matching the same payout level distributed in the prior financial year.

Australia’s benchmark share index has extended its downward run to five consecutive trading sessions, defying strong gains across the healthcare sector and a bumper full-year result from global mining giant BHP that failed to reverse broader market momentum on Tuesday. The flagship S&P/ASX 200 edged down 3.20 points, a marginal 0.04% drop, to close at 9070.00, while the broader All Ordinaries index fell 4.80 points, or 0.05%, to settle at 9274.20. The Australian dollar traded at roughly 70.97 U.S. cents by market close. The trading day delivered a deeply mixed session for Australia’s 11 market sectors, with five closing in positive territory and six finishing lower. Leading all gainers by a wide margin, the healthcare sector surged 7.81% overall, while the energy sector posted a more modest 0.99% rise. The materials sector also recorded mild growth, driven entirely by strong investor demand for BHP shares following the miner’s latest earnings release. BHP closed 2.65% higher at $63.85 per share, though other major local mining players failed to share in the upward momentum: Rio Tinto slipped 0.55% to $167.40, while Fortescue Metals Group fell 0.39% to $17.68. Even with BHP’s share gain, copper prices closed 0.55% lower at $6.57 per pound. Biotech and blood products giant CSL, the heaviest-weighted stock in the healthcare sector, led the sector’s explosive rally despite posting a significant annual net loss. CSL shares jumped 17.25% to close at $157.82, recovering a large portion of the losses the stock has recorded over the past 12 months. Cochlear, the leading implant manufacturer, saw its shares rally 7.58% to $141.20 after releasing an upbeat earnings update, while medical imaging tech firm Pro Medicus gained 11.88% to $196.75 following an annual report that showed a 24.1% rise in underlying profit to $144.7 million. Jamie Hannah, deputy head of investments and capital markets at VanEck, noted that the sharp rally in CSL shares was surprising given the company’s weak bottom-line results in the annual report. “CSL was slightly ahead of analyst expectations, but the market really latched onto the company’s guidance for strong growth next year, and that pushed shares up by a huge amount, nearly erasing the entire drop the stock has seen over the past year,” Hannah explained. “It’s quite incredible. I think you have to question whether the size of the market movement actually reflects the underlying earnings results we’ve seen this earnings season. Right now, companies are under enormous pressure to deliver strong results; if they don’t, investors punish them quite heavily on the market.” Hannah added that the small gain in the energy sector could be traced directly to a recent rally in global crude oil prices, which hit $91 U.S. per barrel ahead of Tuesday’s market close. “That always gives a boost to energy stocks broadly,” he said, “paired with BHP’s stronger-than-expected result, that was enough to keep the sector in positive territory.” The heavyweight financial sector was one of the biggest drags on the benchmark index, with Australia’s so-called Big Four banks all closing in negative territory. Commonwealth Bank of Australia fell 1.44%, ANZ dropped 0.53%, and Westpac declined 1.17%, while National Australia Bank also posted a small single-digit loss. In other individual company news, A2 Milk Company recovered 8.58% on Tuesday after falling 3.26% in the previous session following its own earnings release. Infrastructure firm Reliance Worldwide saw its shares soar 24.65% to $4.50 per share after Canadian global investment giant Brookfield announced a $4.1 billion takeover bid for the company.

Valley Eyewear, the Australian-founded sunglasses brand that counted A-list celebrities including Chris Hemsworth, Margot Robbie, and Kanye West among its high-profile wearers, has been placed into liquidation following a Federal Court order, launching an urgent fire sale of more than AU$600,000 in inventory and business assets.

Established in 2011 on Australia’s Gold Coast by ex-Quiksilver marketing executive Michael Crawley, his wife Tenielle Crawley, and their long-time friend Matthew Grippo, the brand grew from a local startup to a globally recognized label, with distribution across more than 20 countries. It built a reputation for edgy, stylish designs that resonated with both consumers and famous figures, cementing its status as a popular accessories label both at home in Australia and abroad.

But behind its public growth, tensions between the three co-founders escalated into a public court battle, ultimately leading to the court order for urgent liquidation and sale of the company. The liquidation order also extends to House of Valley, a sister entity registered earlier this year to open a new brick-and-mortar retail store and on-site optometry clinic in Burleigh Heads, which has now collapsed alongside the original brand.

Federal Court appointed James Robba and Jason Bettles from insolvency firm Worrells to oversee the liquidation process. The full asset package up for sale includes not only the brand’s large inventory of new sunglasses and optical equipment, but also motor vehicles owned by the business, general plant and equipment, all intellectual property rights, existing customer databases, and the brand’s established digital and social media presence.

Robba confirmed that the business will continue normal day-to-day operations while the urgent sale campaign progresses, noting that the insolvency team is working closely with company directors, employees, and other key stakeholders to facilitate a smooth process. “Our objective is to give interested parties the opportunity to acquire the business of the companies, while seeking to maximise the outcome for all stakeholders,” Robba told local outlet The Courier Mail.

In a surprising development just two days before the liquidation order was issued, Tenielle Crawley registered a new entity named Valley Eyewear Group, with herself and Robert Fullagar listed as co-directors. On the same day, the Crawleys launched a second new firm, Crawley Family Holdings, which now holds a majority stake in the newly registered Valley Eyewear Group. Details on the future plans for the new entity have not been released to the public.

While the full internal circumstances leading to the brand’s collapse have not been made public, this is not the first time the company has faced significant controversy. In 2018, Valley Eyewear drew widespread global backlash after it used the Spomenik Holocaust memorial in Croatia, a site honoring 70,000 people executed during World War II, as a backdrop for an advertising campaign for its “Black Zero” sunglasses collection. The brand quickly issued a public apology, removed all campaign content, and claimed it had been completely unaware of the historical sensitivity of the location at the time of shooting.

Australia’s top banking regulator has taken stiff enforcement action against one of the country’s major regional lenders, forcing it to commit an additional $70 million to fix widespread, long-standing failures in anti-money laundering (AML) and counter-terrorism financing (CTF) controls that slipped through years of internal remediation work.

The Australian Prudential Regulation Authority (APRA) announced the new binding licence conditions for Bendigo and Adelaide Bank on Tuesday, capping off a 12-month industry probe that was triggered after the bank itself commissioned global consulting firm Deloitte to investigate suspicious activity at a single branch in late 2025. What investigators initially expected to be an isolated issue quickly expanded into a company-wide audit that uncovered systemic gaps in how the bank manages financial crime risk, spanning every core layer of its AML/CTF framework.

Deloitte’s final root-cause analysis confirmed widespread failures across multiple critical functions: the bank’s approach to AML/CTF risk mapping, enhanced customer due diligence protocols, enterprise-wide risk oversight, automated transaction monitoring systems, and customer risk rating processes all fell short of regulatory requirements. The review also confirmed that the gaps left the bank vulnerable to potential compliance breaches between August 1, 2019 and August 1, 2025.

APRA’s formal order lays out four distinct categories of material weaknesses that prompted the new regulatory action. First, deficiencies in non-financial risk management are embedded across the entire organization, not limited to a single division or branch. Second, the bank lacks a clear, comprehensive and accurate understanding of its own regulatory obligations, material risk exposures, and key internal controls. Third, there are significant gaps in governance structures, accountability frameworks, compliance management systems, and overall risk management capacity across the bank. Finally, these core weaknesses have persisted for years, even as the bank carried out a multi-year enterprise-wide risk transformation initiative known as BEN+.

To address these failures, Bendigo and Adelaide Bank will invest $70 million over the next three years to overhaul its risk management systems, with the full cost already allocated to the bank’s 2026 financial year results. APRA is also retaining an existing $50 million financial penalty that it imposed on the bank in a previous enforcement action related to the same issues, bringing the total cost of the failures to $120 million for the lender.

Therese McCarthy Hockey, APRA’s Deputy Chair, emphasized in a statement that the new licence conditions reflect the severity of the unaddressed risk gaps uncovered by the probe. “The weaknesses identified by the root cause analysis are significant, longstanding and require decisive action,” she said. McCarthy Hockey added that the regulator acknowledges the cooperative approach the bank has taken so far, and that APRA is encouraged by the board’s public commitment to resolving all identified concerns fully, promptly and effectively. She also confirmed that despite the risk management failures, the bank remains financially sound with no threat to its current operations or customer deposits.

Richard Fennell, Bendigo and Adelaide Bank’s Chief Executive, acknowledged the severity of the gaps in an official response on Tuesday. “Our current non-financial risk management capabilities are clearly not where they need to be, and our risk rectification plan will be designed to drive a fundamental shift in our management of non-financial risk,” Fennell said. He added that the three-year remediation plan will deliver wholesale improvements to the bank’s risk governance and compliance infrastructure to bring the bank back into full alignment with Australian regulatory requirements.

Australia’s household economic sentiment has posted a minor uptick following the Reserve Bank of Australia’s (RBA) decision to hold official interest rates steady, yet broad-based pessimism about personal financial circumstances and the nation’s long-term economic trajectory remains deeply entrenched among Australian consumers.

The latest monthly Westpac-Melbourne Institute Consumer Sentiment Index, one of the country’s most closely watched measures of household economic mood, recorded a 6% gain in August to reach 88.9. While this rise marks the first improvement in sentiment in months, the reading still sits well below the 100 threshold that divides prevailing pessimism from optimism, confirming that negative outlooks continue to dominate public opinion.

Westpac’s chief economist Luci Ellis noted that cost-of-living pressures continue to squeeze household budgets across the country, even after the small improvement in mood. “This is still a weak result and noticeably lower than the readings recorded last year,” Ellis explained. “While consumers are feeling less pessimistic than last month, pessimists still outnumber optimists, especially about their current finances.”

Survey data shows the shift in sentiment happened almost immediately after the RBA’s monetary policy board announced it would keep the official cash rate unchanged at 4.35% on August 6. Responses collected before the announcement showed no change from July’s weak reading, with the entire monthly gain coming from surveys completed after the decision was made public.

The RBA’s announcement came with a hawkish undertone, however: Governor Michele Bullock confirmed that board members had discussed a potential rate hike during the meeting – a step the board did not take during its May 2024 gathering. Bullock also warned that additional rate increases remain on the table as the central bank works to prevent currently elevated inflation, which sits at 3.8%, from becoming permanently embedded in the Australian economy.

Markets and economists broadly expect the RBA will hold rates steady again when the board next convenes for its September 28-29 policy meeting. A softer-than-expected labour market and only one new monthly inflation reading due before the gathering have reinforced expectations that policymakers will leave policy unchanged for another month. Ellis noted that the RBA already has lifted rates three times in 2024 to bring the cash rate to a restrictive level, giving policymakers room to pause and assess how previous tightening has impacted economic activity across the country.

“Having already raised the cash rate three times this year to a restrictive level, the monetary policy board has scope to keep the cash rate on hold while it monitors the effect of policy tightening across the economy and confirms whether underlying inflation has peaked,” Ellis said.

Most of the confidence gains were concentrated in assessments of current economic conditions, with attitudes toward long-term economic prospects remaining firmly negative. The report also revealed uneven sentiment shifts across demographic groups: sentiment among renters rose in the days after the RBA meeting, but weak readings from before the announcement left overall renter sentiment slightly lower for the month as a whole.

Two key sub-indexes posted notable improvements in August: the gauge of attitudes toward major household purchases rose 8.1% from 86.8 in July to 93.8 this month, while the index measuring year-over-year changes in household financial pressure improved 12.6% to 80.0. Even with these gains, however, both measures remain in pessimistic territory, underscoring that Australian households are still feeling significant economic strain.