Unemployment in Australia jumped in April as more people searched for work, a rise that is likely to reduce pressure on the Reserve Bank of Australia to raise interest rates further, the Wall Street Journal reported. The unemployment rate rose to 4.1% in April from 3.9% in March, the Australian Bureau of Statistics said Thursday. Economists had expected the jobless rate to remain steady at 3.9%. The increase in unemployment came despite the economy adding 38,500 new jobs over the month. That wasn’t enough to account for a rise of 68,800 in the number of people seeking employment.
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The Reserve Bank of Australia left interest rates unchanged Tuesday, and stuck with the message that it isn’t ruling anything out as it seeks to bring inflation under control, the Wall Street Journal reported. The RBA held the official cash rate at 4.35%, where it has remained since November. The outcome was widely anticipated by economists. “The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain and the Board is not ruling anything in or out,” the RBA said at the end of a two-day policy meeting.
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Australian budget airline Bonza has canceled all flights through May 14 as lessors seek to seize its planes, Bloomberg News reported. The embattled carrier grounded its fleet on April 29 after the lessors issued termination notices. Hall Chadwick, which has been appointed as administrators to the airline, said Tuesday it has been in discussions with the lessors to see whether the grounded planes could become operational in the short term, but to no avail.
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Australia plans to wipe out about A$3 billion ($2 billion) from student loans, cutting the debt of more than three million people, as the country continues to grapple with inflation and cost-of-living pressures, Bloomberg News reported. The center-left Albanese government announced the measure in its monthly budget on Sunday in hopes that it would ease economic pressure on workers and students, said Minister for Education Jason Clare in a statement.
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Australian low-cost carrier Bonza has gone into administration, a process similar to U.S. bankruptcy, after saying earlier on Tuesday that it was suspending flights amid discussions about the continuing viability of its business, WSJ Pro Bankruptcy reported. A regulatory filing with the Australian Securities & Investments Commission said employees from accounting and advisory firm Hall Chadwick had been appointed as administrators.
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Australia plans to toughen its corporate merger rules amid regulators’ and public concerns that market concentration is restricting competition in key industries and adding to inflation, the Wall Street Journal reported. The reforms will strengthen and simplify Australia’s merger approval system, the federal government said Wednesday. It plans to give the competition watchdog additional powers to scrutinize all mergers above certain value and market-share thresholds.
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Bankruptcy Regulator Warns Vulnerable Australians Are Getting Caught Up in Rising Insolvency Figures
The country’s bankruptcy regulator has warned of the rising number of personal insolvencies affecting vulnerable Australians, as small business owners struggle to make ends meet due to mounting debts. Australian Financial Security Authority chief Tim Beresford said personal insolvency was “rising,” with rates increasing from about 10,000 last year, to 12,500 this year, and 15,000 next year. “The 10-year (annual) average is 23,000,” he told small business leaders at the Council of Small Business Organisations Australia national small business summit on Thursday.
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The Reserve Bank of Australia now feels that risks around the outlook for the economy are slightly more balanced than earlier in the year, while signaling that it isn’t ruling any policy options in or out for now, the Wall Street Journal reported. In minutes of its March 18-19 policy meeting published Tuesday, the interest-rate setting board of the RBA said that while there are ongoing risks to inflation and weak economic growth, they are largely even.
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In a sign of easing tensions between Australia and China, China said Thursday that it would lift the tariffs it placed on Australian wine more than three years ago, the New York Times reported. The tariffs, which were first imposed in 2020 amid a nasty diplomatic spat between Australia and China, had all but vaporized the country’s biggest overseas market, worth 1.2 billion Australian dollars or around $800 million at its peak. Australian winemakers faced desperate hardship and were stuck with a surfeit of big-bodied red wines.
Australia’s highly indebted households appear well-placed to continue riding out the pain of high interest rates and soaring living costs, with even the most vulnerable in a position to continue servicing mortgages, the Reserve Bank of Australia said Friday, the Wall Street Journal reported. In its latest report card on financial stability, the RBA said that while high inflation and interest rates have put pressure on household budgets over the past two years, nearly all borrowers continue to service their debts on schedule.