More WA workers expect a pay rise

West Australians expect the biggest pay rises of any workers in the country, believing the global recession is over and the mining boom has arrived.

A report by Westpac has found 14 per cent of West Australians expect a pay rise of at least 8 per cent over the coming year, while another 21 per cent think they’ll get a rise of between 4 per cent and 8 per cent.

It is the highest proportion of workers in any State who think they will be rewarded with a wage rise two or three times the rate of inflation.

And in a sign of the confidence of WA workers, just 0.4 per cent of those surveyed say they will have a pay cut – the lowest proportion of any State. By contrast, more than 6 per cent of South Australians fear they will have their pay cut while just 19 per cent expect a pay rise of at least 4 per cent.

More than 35 per cent of those aged between 18 and 24 expect a pay rise of at least 8 per cent compared to less than 10 per cent of people aged 55-64. While 35 per cent of respondents who earn more than $100,000 a year expect at least an 8 per cent rise, less than half of those earning under $40,000 expect any pay rise.

CommSec chief equities economist Craig James said that despite signs of optimism, Australian consumers were increasingly conservative. While household disposable income had grown almost 8 per cent last year, close to the fastest rate in 19 years, consumer spending had lifted just 2.2 per cent or the slowest in 16 years.

“And then there is the news that 70 per cent of Commonwealth Bank home loan customers are ahead in their loan repayments – making higher repayments than they need to,” he said. “How long this new conservatism continues remains anybody’s guess.”

Source  :  www.thewest.com.au

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RBA lifts rates

The Reserve Bank has raised its key interest rate, making Australia the first developed nation to reverse the cycle of cuts triggered by the global financial crisis. Analysts say more increases are on the way.

Today’s 25-basis-point rise pushes the central bank’s cash rate to 3.25 per cent in a move that will add $40 to the average monthly payment for a typical $300,000 mortgage if it is passed on by commercial banks. The extra cost may stretch household budgets at a time when unemployment remains on the rise.

All four of the big banks – Commonwealth Bank, Westpac, National Australia Bank and ANZ – said they have placed their variable interest rates under review.

Source  :  www.watoday.com.au

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Swan slams ‘selfish’ CBA rate decision

Treasurer Wayne Swan has taken aim at Australia’s biggest home lender, labelling it selfish for lifting its mortgage and business lending rates. 

Other banks have refused to rule out following the Commonwealth Bank of Australia’s (CBA’s) surprise decision to lift its home and business loan rates by 10 basis points to offset higher funding costs.

The opposition said the government’s huge debt burden was putting pressure on interest rates, while a prominent market economist said it may force the Reserve Bank of Australia (RBA) to cut the official rate again to counter any impact from CBA’s move.

CBA said it took Friday’s decision “reluctantly”, but at a standard variable mortgage rate of 5.74 per cent, up from 5.64 per cent, it was still the lowest on the market.

The rate hike will add $18 a month to repayments on a $300,000 home loan over 25 years.

The bank said it had absorbed as much of its additional funding costs for as long as it could.

“Unfortunately, we have seen the bank’s wholesale funding costs remain high and continue to increase as previous long term funding matures and is replaced with new funding at significantly higher cost,” CBA group executive of retail banking services Ross McEwan said in a statement.

Such reasoning drew no sympathy from the treasurer.

There are ups and downs when it comes to those decisions over time, but there are few decisions I can think of that are more selfish than this one,” Mr Swan told reporters in Brisbane.

“I think Australians, rightly, will be furious with the Commonwealth Bank.”

Prime Minister Kevin Rudd echoed those sentiments during a speech to a business lunch in Brisbane.

“We are all in this together – businesses, workers, government and the Reserve Bank – and today’s decision by the Commonwealth Bank runs counter to this nationwide effort,” Mr Rudd said.

The other three major banks – ANZ, National Australia Bank and Westpac – said their rates were constantly under review.

NAB said it had no current plans to raise its home loan rate but noted “all Australian banks” had been incurring significantly higher funding costs for some time.

Opposition treasury spokesman Joe Hockey said the government was putting pressure on interest rates by running up a huge debt.

“Kevin Rudd and Wayne Swan feigned outrage about this interest rate increase, yet they are directly responsible for it,” Mr Hockey told reporters in Sydney.

“This is the beginning. You will end up with higher interest rates directly as a result of the spending binge of the Rudd government and the massive debt they are accruing.”

Home buyers may be enjoying the lowest mortgage rates in 41 years, but have already missed out on about 30 to 40 basis points of the RBA’s total 425 basis points of official rate cuts, with banks refusing to pass on the cuts in full because of the cost of funding.

For small businesses it has been even worse, being short changed by about 140 basis points.

The CBA’s decision comes in a week that saw massive boosts to both consumer and business confidence, as well as data showing sustained growth in home lending – sucked in by low mortgage rates and a more generous first home owners grant.

April mortgage data showed loan demand has grown for seven straight months to a 14-month high, as well as record demand from first home buyers and the strongest interest from investors in nearly two years.

It also showed that the banks have cornered more than 92 per cent of all loans – a 33-year high.

Westpac chief economist Bill Evans said CBA’s decision could well be countered by another cut by the RBA.

“If it does have an impact, particularly on confidence in the housing market, which has been the most encouraging source of recovery in the Australian economy, it may bring a rate cut back on the table at the Reserve Bank,” Mr Evans told Sky News

Source  :  www.thedaily.com.au

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Australia stocks close at seven-month high

The Australian share market closed at its highest level in nearly seven months as better-than-expected local and overseas economic data heartened investors and boosted resources stocks.

At the 1615 AEST close, the benchmark SP/ASX200 index had lifted 60.9 points, or 1.56 per cent, to 3955.3, while the broader All Ordinaries index advanced 61.7 points, or 1.59 per cent, to 3949.6 points.

The last time the local market had closed at those levels was in mid-November 2008.

The local bourse rose as a narrowing current account deficit and improving trade position raised expectations that the Australian economy had managed to avoid a contraction in the March quarter.

Building approvals rose for the third consecutive month as low interest rates and grants from the federal government enticed home buyers.

Resources stocks have been lifted by data released by China on Monday showing that China’s manufacturing activity had expanded in May for the third consecutive month.

In the US overnight, better-than-expected readings on manufacturing, consumer spending and construction spending boosted Wall Street.

The Reserve Bank of Australia, which kept interest rates unchanged on Tuesday, also said there was evidence the global

economy was stabilising and the turnaround was clearest in China.                                                                                                                            

City Index markets strategist Alex Douglas said the positive data releases over the last few days were driving the market.

‘If we go back to yesterday, there was positive data from China.

‘That was backed up with some manufacturing data in the States overnight which was slightly firmer than anticipated,’ Mr Douglas said.

Locally, the building approvals figures were also positive.

‘So little bits of evidence like that of growth emerging – that’s helping to support the markets,’ Mr Douglas said.

In the resources sector, global miner BHP Billiton gained 96 cents to $36.70.

Rio Tinto jumped $2.67 to $69.00 after the company announced it had settled terms of iron ore contracts with many Asian customers.

Oil and gas producer Woodside Petroleum rose 88 cents to $44.90 as it said it planned to retain at least 50 per cent equity in the second and third stages of its Pluto liquefied natural gas (LNG) development at Karratha in Western Australia.

Santos firmed five cents to $14.90.

Among the major banks, Commonwealth Bank strengthened 17 cents to $36.33, Westpac surrendered 18 cents to $18.76, ANZ gave away 21 cents to $15.98, and National Australia Bank gained 28 cents to $22.80.

Investment bank Macquarie Group was up 91 cents at $36.30 as it said it was not aware of any reason or information not already announced that could have prompted a lift in its share price since late last week.

On Wall Street overnight, the Dow Jones Industrial Average index rose 221.11, or 2.6 per cent, to 8,721.44.

In the gold sector, Lihir slipped one cent to $3.30, Newmont lost 24 cents to $6.00, and Newcrest picked up 15 cents to $33.89.

The price of gold in Sydney at 1628 AEST was $US973.85 per fine ounce, down $US10.25 on Monday’s close of $US984.10.

Telco Telstra was off two cents at $3.07, and Optus-owner Singapore Telecommunications shed six cents to $2.50.

Retailer Woolworths ascended 60 cents to $26.00, and Wesfarmers, which owns Coles, was $1.09 heavier at $23.37.

In the media sector, News Corp was 25 cents richer at $14.68, and its non-voting stock improved 20 cents to $12.75.

Consolidated Media lifted three cents to $2.38, and Fairfax gained six cents to $1.26.

Among other stocks, automotive brakes supplier Pacifica Group was steady at 13.5 cents after it said the bankruptcy of car-making giant General Motors Corp in the United States was likely to hurt Pacifica’s earnings in 2009.

The top-traded stock by volume was property developer GPT group, with 74.74 million shares worth $36.4 million changing hands.

GPT was 1.5 cents lower at 48 cents.

Preliminary national turnover was 2.43 billion shares worth $5.85 billion, with 657 stocks up, 412 down and 324 unchanged.

Source www.bigpondnews.com

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CommBank cops sustained online fraud attack

Commonwealth Bank customers are being inundated with phishing attacks, some at a rate of several scam emails a day, sent by cyber criminals seeking to steal passwords and credit card details.

The scammers, who are specifically targeting the bank in a sustained assault, are bombarding customers with several clever variations of the email ruse – such as using bogus call centres – in an attempt to hook even tech-savvy web users.

The emails have largely managed to evade spam filters using methods such as images instead of text.

Commonwealth Bank spokesman Steve Batten admitted the bank was losing the war with the fraudsters, despite working closely with the Australian Federal Police’s Australian High Tech Crime Centre.

“As soon as we close them down they are opening up elsewhere,” Batten said.

This is backed up by figures from the Australian Payments Clearing Association, which reported a 33 per cent increase in both the volume and value of fraudulent online payments in Australia for the year ended December 31, 2008.

The scam emails, which look authentic and include the Commonwealth Bank’s logo, try to trick the victim into handing over sensitive information by telling them they need to unlock an account, activate a card, claim a fee refund, update internet banking details, view an important security message or complete a survey in exchange for payment.

When the victim clicks on the link in the email, they are either infected with a password-stealing virus or presented with an official-looking page that asks them to enter their details, which are then harvested by the fraudsters.

Batten said some of the emails purport to come from actual Commonwealth Bank staff members. He stressed that the bank would never ask customers to submit sensitive information over email.

But in a new variation on the traditional “phishing” attack, which usually asks victims to click on a malicious link, one Commonwealth Bank scam email asks customers to call a Queensland phone number in order to redeem a $500 “cashback bonus”.

IT contractor Tom Howard, from the Central Coast, received the email and attempted to call the number just as an experiment.

“It’s an automated system with an American accent that welcomes you to the Commonwealth Bank of Australia and then requests an account number or says something’s expired and asks for your credit card number,” he said.

The voice recording then requested Howard’s expiry date and pin number, but he just entered in random digits.

“It actually told me the information was incorrect, which suggests that it’s hooked up to a payment gateway and it’s actually trying to do an authorisation on the credit card right then and there,” he said.

Howard said he was alarmed at the sophistication of the scam and believed the bogus call centre idea would trick a lot of people.

“People have been conditioned in terms of these phishing emails to ‘don’t click on the links’, but not so much to ‘don’t call the number’,” he said.

Source: smh.com.au 

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Australian share market opens higher

THE share market has opened marginally stronger the morning after the federal budget was handed down, and following a mixed lead from Wall Street.
At 10.15am (AEST), the benchmark S&P/ASX200 was up 12.1 points, or 0.31 per cent, at 3889.3, while the broader All Ordinaries gained 8.7 points, or 0.23 per cent, to 3872.3.

The four major banks were mostly higher at the open.

ANZ gained 4cents to $16.01, NAB was up 14 cents at $22.00 and Westpac was up 10 cents at $20.48.

The Commonwealth Bank, which reported cash earnings for the March quarter of about $1.15 billion, generating a cash return on equity of over 15 per cent, was down 20 cents at $36.40.

Resources weren’t as lucky, opening lower in morning trade.

Mining giant BHP was down five cents at $34.26, while rival Rio Tinto lost 4.41 per cent to $65.46.

Wall Street wobbled to a mixed finish on Tuesday as investors paused to assess gains from a long rally and mulled the new efforts to raise capital by banks and other firms.

The markets also digested better-than-expected data on the US trade deficit and reassuring comments from Federal Reserve chairman, Ben Bernanke, about the health of the banking system.

The Dow Jones Industrial Average was up 50.34 points, or 0.60 per cent, to settle at 8,469.11.
The tech-dominated Nasdaq dropped 15.32 points, or 0.88 per cent, to 1715.92 while the broad-market Standard & Poor’s 500 index lost 0.89 point, or 0.1 per cent, to settle at 908.35.

On the Sydney Futures Exchange, the June share price index contract was trading 17 points higher at 3885 on volume of 4900 contracts.
www.news.com.au

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