Hopes rate hikes on pause; could house prices fall 10pc; SpaceX $US2 trillion IPO
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What is the main topic discussed in this episode?
Welcome to Fear and Greed, business news you can use today.
What recent economic data has influenced interest rate decisions?
A surprise jump in the unemployment rate has raised hopes that the Reserve Bank will hold back on lifting interest rates. Virgin scraps flights as it looks to save on fuel costs.
How is Virgin Australia adapting to rising fuel costs?
And Elon Musk's SpaceX set to hit the share market with a valuation of $2 trillion.
What are the implications of SpaceX's $2 trillion IPO?
Plus warnings that house prices could fall 10%.
Could Australian house prices fall by 10% due to economic changes?
and the afl footballer who is likely to make more in one game tomorrow than his annual salary in most years it is friday the 22nd of may 2026 i'm michael thompson and good morning sean aylmer good morning michael sean the main story this morning the unemployment rate jumped to 4.5 percent last month as the number of employed people dropped for the first time this year The lower than expected figure could give pause to any further hike in interest rates, at least in the short term, according to economists. The number of unemployed Australians jumped by 33,000 last month, and that pushed the unemployment rate up to 4.5%, up from 4.3% in March. Fewer people were looking for work, and the net impact and workforce and employment changes meant that the economy was
shed 18,600 jobs in April.
Yes. Now, the statistician did warn that numbers were impacted by Easter falling during the month. And there's always plenty of moving parts in any ABS statistic, let's face it, but particularly the employment data.
What are the contrasting views on the future of interest rates?
However, Michael, as the T-shirt will soon say, the trend is your friend. Yes. And when we're thinking trends and labour markets, look at the unemployment rate. For April, at least... It is at a level above Federal Treasury and the Reserve Bank's forecast. And that's before the full impact of three interest rate hikes kick in. Also before the soaring prices flowing from higher fuel costs kick in. This suggests there is a slowdown in the economy.
But... Sean, what we all want to know is what does it mean for interest rates? Well, what I want to know, what everyone in the studio, being me and you, what we all want to know.
How is the Australian share market reacting to economic news?
Interest rates. Is the jump in the unemployment rate going to be enough to stop the RBA from lifting rates when it next meets in June? Well, that is the question, isn't it?
The $64 question. That's why I asked it. So I'm going to give you two sides of this story. HSBC Australia Chief Economist Paul Bloxham, he called yesterday's figure a decisive marker. Now, Paul used to work at the Reserve Bank. He thinks the RBA has done enough to slow the economy and eat into inflation. He doesn't expect the cash rate to rise again this year. Flip side, Westpac chief economist Lucy Ellis. She agrees yesterday's numbers were weak, but it might not be enough to, well, it might be enough to convince the Reserve Bank not to lift rates in June.
What are the potential impacts of the recent budget on the housing market?
She still thinks they're going higher later in the year, and that will depend on the size and pace of pass-through of the energy price shock that's revealed. National Australia Bank yesterday, for example, said they probably won't move in June, though stayed away from saying they'll move stop altogether. Commonwealth Bank seems to be leaning on, we're not going to have another rate hike. So bond markets, better talk about that, Mike, because remember yesterday, you taught me about bond markets yesterday. You told me that they predicted future interest rate rises.
That's right. That's right. And I can tell you any other thing you want to know about bond markets, but just give me a little bit of time to prepare it.
Yeah. They reckon there might be a rate rise in June. So where we're landing is we probably won't have a rate rise in June. That's where the smart money is going. And the Reserve Bank sort of hinted at that in its minutes during the week. And some people are saying maybe we won't have any more rate rises. It really does depend on inflation, obviously, but how quickly the economy slows, thanks to what's already happened in terms of monetary policy this year.
It is interesting that you quoted two economists there who have both been at the Reserve Bank in terms of Paul Bloxham and Lucy Ellis, and both of them have slightly different interpretations of what it's going to mean.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:06–0:09
2
What recent economic data has influenced interest rate decisions?
0:09–0:19
3
How is Virgin Australia adapting to rising fuel costs?
0:19–0:25
4
What are the implications of SpaceX's $2 trillion IPO?
0:25–0:28
5
Could Australian house prices fall by 10% due to economic changes?
0:28–1:36
6
What are the contrasting views on the future of interest rates?
1:36–2:17
7
How is the Australian share market reacting to economic news?
2:17–3:02
8
What are the potential impacts of the recent budget on the housing market?
3:02–17:54
Speakers
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