All About Business

Energy Watch accused of deceptive conduct

2011-08-28T03:00:00.000-07:00

The competition and consumer watchdog has launched legal action against price comparison service Energy Watch and its founder Ben Polis for "deceptive conduct".

Energy Watch assesses a household's energy costs and consumption and advises customers on whether they can get a better deal elsewhere.

The Australia Consumer and Competition Commission (ACCC) alleges the company passed on false or misleading information in comparing energy rates and the money saved by using the service.

The company allegedly broadcast the information through a range of media, including on scoreboards during AFL matches.

Energy Watch founder Ben Polis says he will vigorously defend the allegations.

He says Energy Watch promotes competition, and he is concerned the ACCC does not understand how the business operates.

"We've also been investigated recently by other energy bodies and those sorts of things who have got no issue with the way our business works," he said.

"And I think the ACCC at this stage needs to have more of a clarification how our business works. They've made quite a few assumptions that are not true.

"One of the things that I find quite ironic is that Energy Watch has been built to create competition between energy retailers and obviously the ACCC is there to promote competition."

Mr Polis says Energy Watch has saved consumers over $50 million since its inception and the company has driven down electricity prices.

The matter has been filed in the Federal Court in Melbourne.

Source: http://www.abc.net.au/news/2011-08-27/accc-launches-action-against-energy-watch/2858360?section=business

Is it safe to Buy Gold Now?

2011-08-12T23:39:00.000-07:00

Gold is a very safe form of investment amid the global economic crisis. However, people should still be cautious in investing.
"Gold (is) a very safe investment. Moreover, the current global crisis, U.S. and European debt to trillions," said Chairman of the Association of Gold and Jewels Indonesia (APEPI) Jeffrey Thumewa to Kompas.com via telephone on Friday (12 / 8 / 2011).
According to him, with the back of gold prices, the purchase of gold also tends to rise. However, he could not say exactly how much a rise in demand for gold.
He said that gold investment is safe to do by society, which typically invest in small form. "Only, it's actually a great price, the quantity they buy less if the same budget," he said.
However, he said, gold is safer to invest than money to be rapidly depleted because it can be used for many purposes.
Jeffrey said, although the current gold price tends to rise, this could be the yellow down. "Anything can happen. Gold could go down (significantly), certainly can," he said.
First, the price of gold is only concerned with dollars. If the dollar falls, gold price rises, and vice versa. However, he continued, is now the gold price movement can be influenced by global political conditions. "Invasion of the war could be the cause," he said.
Outline, right now, investing into the yellow metal is rapidly increasing due to safety factors.
As reported, PT Aneka Tambang (Persero) also mentioned, the demand for gold production behind this rise. "Therefore, investment in gold gave back a big result so the price has continued to improve," said President Director of PT Aneka Tambang (Persero) Alwin Syah Loebis Thursday.
For information only, this Friday, Precious Metals bullion prices released at 532,000 Rupiah per gram. As for the purchase of one kilogram of gold bullion (commonly used reference price), a business unit of PT Antam is set at 490,000 Rupiah per gram.

Source: http://bisniskeuangan.kompas.com/read/2011/08/12/11014299/Amankah.Beli.Emas.Sekarang

Myer woos online shoppers with free shipping

2011-08-02T09:45:00.000-07:00

MYER wants shoppers back and is prepared to suffer for it.

Slashing prices hasn’t stemmed the flow of Aussies to overseas websites, where the goods are cheap thanks to a strong Australian dollar, so the department store is trying another strategy: free shipping.

Fairfax reports that Myers is dumping shipping and handling costs for its website, while its main rival, David Jones, is also reviewing its pricing policy.

The Commonwealth Bank estimates Australians spent $9.5 billion last year on online shopping sites, $4.2 billion of it on overseas sites and the remaining $5.3 billion at Australian online stores.

Myer boss Bernie Brookes said while he was aware free shipping would come at a cost, but the department store had “run the numbers” and believed the model would work.

''We do about $5 million a year online,'' Mr Brookes said. ''The plan is to increase that closer to $50 million a year very quickly. This is something we have been planning for a while now.

A Myer spokesman said free online shipping could raise revenue five to ten fold, according to research conducted by the company.

David Jones also is reconsidering the pricing of its online shipping and looking into greater use of iPhone apps.

source: http://www.news.com.au/business/come-back-myers-bid-to-win-back-shoppers/story-e6frfm1i-1226106402997

Property prices Increase in Vancouver because of the Chinese People

2011-07-24T01:20:00.000-07:00

VANCOUVER - Chinese lifestyle has changed a lot. China is no longer reflects the underdeveloped countries and poor people. China's increasingly affluent people, not only in his country, but also abroad.

The proof, property prices in Canada increasingly expensive as more and more Chinese people to buy property in the city of Vancouver. Property prices in the city rose at least 50 percent in the last three years.

Su Yi Bin, a merchant, has just bought a house area of 450 square meters. The price? 4.3 million Canadian dollars or equivalent to Rp 38.7 billion. Su lives in Vancouver and Shanghai. When he was in China, he wanted his family comfortable in this new country.

"For my son, grew up and went to school here (Vancouver) will provide an opportunity for him to fully integrate with the world, become part of international life," he said. "It's hard to find in China," continued Su again.

Property prices in Vancouver rose 54 percent in the last three years. Last year alone, prices rose 13 percent. Vancouver real estate agent, Clarence Debelle, seeing so many Chinese who do business in Canada. Only in the last five months, clients in China rose from two to 40 people.

"In West Vancouver, not too many homes available. Buyers China seems to require a lot of houses here. I think house prices will continue to rise," he said.

Seeing the potential market like this, Cam Good build two apartment buildings similar to those in Hong Kong and Beijing.

In China, in some big cities like Beijing, residents are prohibited from having more than two properties. Measuring 70 square meters apartment worth half a million dollars Canadian, or USD 4.4 billion apparently expensive, even with the lure of ocean views.

"We have consulted with a Feng Shui expert to the property is suitable for Chinese people," added Debelle. The result, half of the first 40 buyers of apartment units that were Chinese

Source: www.kompas.com

Blue chip shares that pass the test of time for investors

2011-07-17T11:24:00.000-07:00

Best-performing stocks revealed
Best for a buy-and-hold strategy
Market has dropped but steadier outlook
Money: Latest investing news and advice

BHP Billiton and the big banks may be the most popular stocks, but other blue chips have delivered investors better long-term growth.

Research by Macquarie Private Wealth examined our biggest stocks and found almost all had good average annual growth in the long term.

Just 18 stocks that are in the current S&P/ASX50 index of the 50 biggest companies were around in 1980.

The best performers have been Coca-Cola Amatil, Leighton Holdings, News Corporation and QBE Insurance.

The only stock to suffer a negative annual growth was property trust GPT Group, at -1.4 per cent, after it plunged from $19 to $2 a share during the global financial crisis.

Macquarie Private Wealth head of research Riccardo Briganti says building a blue-chip share portfolio requires more than just picking the best historical performers.

"Each stock has had periods of poor performance not necessarily related to market movements," he says.

"Coca-Cola Amatil had three consecutive years of poor performance in the late 1990s when the broader market was providing above-average returns. It then outperformed the market in the subsequent five years."

Several of today's biggest companies were not listed in 1980, with the Commonwealth Bank joining the ASX in 1991 and Woolworths in 1993.

A blue-chip stock derives its name from the tokens used in casinos where, traditionally, the blue chip was the highest-value, Mr Briganti says.

But, he says, instead of a speculative gamble, they are "the stocks seen as appropriate for a buy and hold strategy".

"Don't be fooled when someone says: 'This stock has given you the best return and therefore it's the best investment'. How risky is it?"

Mr Briganti says a solid blue-chip portfolio should hold at least 10 stocks to be properly diversified, and investors should make their decisions based on dividends as well as capital growth.

Healthy dividends are a key reason for the banks' popularity among investors and super funds.

"The capital return of BHP has averaged 13.3 per cent per annum since 1980, compared to ANZ's lower capital return of 9.8 per cent," Mr Briganti says.

"However, the dividend yield from ANZ has consistently been above 4 per cent whereas BHP has recently been closer to 2 per cent."

Macquarie's 12-month dividend forecasts for the big banks are all above 6 per cent, with franking credits lifting the after-tax dividend yield further.

Australian Index Investments says the banks' after-tax dividend yields should top 9 per cent next financial year, thanks to the 30 per cent tax credit that investors get for fully franked dividends.

It says bank shares have underperformed the broader market over the past year and their dividend income is now "substantially higher" than term deposits.

"A more attractive and tax-effective option might be using those term deposits to buy bank shares," Australian Index Investments chief executive Annmaree Varelas says.

The overall market has dropped sharply in the past month, but Mr Briganti still sees steadier times ahead.

He says Macquarie's forecast for the S&P/ASX200 index is 5190 points by June 2012, a rise of 13 per cent above current levels, despite renewed fears about European debt and money printing in the US.

"We believe that these issues are transitory and (are) going to be resolved. If you look at the underlying economic growth of the world, it's solid."

But investors are growing more uncertain, with a new survey by the Australian Investors Association finding the number of people bearish about the future has more than doubled since January to 35 per cent.

The proportion of investors bullish about shares has dropped from 31 per cent in January to just 11 per cent in May.

"Our members remain cautious about how they approach markets for the rest of this year," AIA president Alison Harrington says.

And while many of us can't stretch out budgets to snap up Rio Tinto shares at $80-plus or BHP and Woodside Petroleum at $40-plus, there are many cheaper stocks listed on the S&P/ASX 50.

Those under $10 (latest price June 10) include AMP, Alumina, Bluescope, Fosters, Brambles, Tabcorp and Fortesque.

News Source

Weekend, JCI Potentially Back to 4000

2011-07-14T16:36:00.000-07:00

Composite stock price index (CSPI) on the Indonesian Stock Exchange re-entrenched in the positions predicted 4,000, or the psychological level as well as new record highs in the history of trade that was achieved last Friday, July 8, 2011.
According to analysts of the Securities Analysts Association of Indonesia, Ukie Jaya Mahendra, JCI is expected to play again in the range of 4000-level in trading today, Friday, July 15, 2011. JCI movement because it supported a number of positive sentiment in the country and overseas.
"Domestic factors such as the sentiment that the financial statements the first half of 2011 and a number of blue chips in the mining sector that has not increased much," he told VIVAnews.com here on Thursday evening July 14, 2011.
In the meantime, sentiment abroad, he said, related to commodity price of gold through the highest level in the new position of U.S. $ 1,578.89 an ounce from U.S. $ 1575.79 per ounce recorded May 2 last. In addition, world crude oil prices are rising again.
"The economic data is good in America, after the speech by Federal Reserve Governor Ben Bernanke that support acceleration of the economy," said Ukie.
Positive factors abroad, according Ukie, will be a positive response to global and regional markets, including Indonesia stock exchange. "So, for this weekend, JCI has the potential to penetrate more powerful level of 4,000," he said.
Robin Setiawan, PT Valbury Asia Securities analyst also believes similar. CSPI on Friday trade remain well above chance levels of 4,000.
"Commodity prices outside, both mines and plantations which could rise prompted investors to buy shares again enliven the transaction," he said.
Meanwhile, in trading Thursday, JCI seen as the leader of the strengthening of regional stock indexes end higher after 16.79 points, or 0.42 percent at 3997.63 position.
In regional markets, the Hang Seng index closed up 13.32 points (0.06 percent) to a level of 21940.20, the Shanghai Composite rose 14.97 points (0.54 percent) to 2810.44, and the Straits Times rose thin 0, 28 points or 0.01 percent at 3088.70 position

Property Purchase Dominated by The Speculator

2011-07-13T06:17:00.000-07:00

Jakarta - Real Estate Indonesia (REI) Jakarta noted there has been growth in the capital of a significant property. Despite growing, but property buyers in Jakarta is dominated by speculators who expect higher yields.

Said the Chairman of the DPD REI Jakarta, Rudy Margono who also serves as Director of the Gate Prima Group in Jakarta, Wednesday (13/07/2011).

"Now a lot of speculators. If so we can not prevent, because it occurs in the field," he said.

The number of speculators, it potentially reduces the chance of people who do not have a shelter. Because only certain groups who continue to 'collect' dwelling with the intent of investment.

On the other hand, he admitted to Jakarta property growth in recent months is remarkable. This impact to the soaring land prices in the capital.

"Of course we hope not to price (the property) is not affordable. There must be no bubbles rise, because the price does not correspond to people's purchasing power," he said.

Indonesia's house prices continue to rise significantly. The results of research from Knight Frank's property showed a rise in house prices in Indonesia is the highest to the 14th in the world.

Growth in housing prices in all major cities in Indonesia is still experiencing an increase over first quarter 2011 by 4.5% over the same period last year. The average price of housing in big cities like Jakarta and surrounding areas, especially in some fancy rose above 10%.

Source: http://us.finance.detik.com

ASEAN Choose Japan For Partner

2011-07-12T02:21:00.000-07:00

ASEAN countries agreed to develop together into the center of world economic growth. To that end, ASEAN chose Japan as the country's strategic partner. Although the Japanese economy is on the rise after the earthquake and tsunami, Sakura is committed to spurring economic growth in ASEAN.

Thus the results of a meeting of economic ministers of ASEAN and Japan, which was held in Kuala Lumpur last week. Japan led by Minister of Economy, Trade and Industry to bring 70 businessmen.

"They want to affirm its commitment to ASEAN is not reduced even though their economy is on the rise," said Trade Minister Mari Elka Pangestu said here on Monday (11 / 7).

According to him, the meeting discussed three important issues that ASEAN could develop into a center of world economic growth. First, acceleration of infrastructure development both hardware and software, such as physical facilities and broadband networks. Second, the elimination of non-tariff barriers as well as the equalization standard, both goods and services. Third, the reduction of exhaust emissions and the application of the concept of reuse, reduce, and recycle.

Let's say, the role of ASEAN Japan's economy is huge. "We continue to view Japan as a strategic partner in the middle of the growing role of China and India. The dialogue is clearly felt the spirit together, to meet new economic growth centers in Asia," he explained.

China Sluggish Economy, Oil Prices Depressed

2011-07-12T01:58:00.000-07:00

NEW YORK Oil prices fell Monday, pressured by increased market concerns China's economic slowdown and the euro zone debt crisis. New York's main contract, light sweet crude or West Texas Intermediate (WTI) for August delivery, closed at 95.15 dollars a barrel, down 1.05 dollars from Friday's close last week.

In London, Brent North Sea crude oil for August delivery slid 1.09 dollars to settle at 117.24 dollars a barrel. On Friday, the benchmark New York contract West Texas Intermediate shrunk almost 2.50 U.S. dollars after the release of June employment report concern in the United States, the world's largest oil consumer.

The development of the U.S. economy does not have much impact on job creation and the unemployment rate rose unexpectedly to 9.2 percent. "We not only see the hope of softening demand in the United States but also worldwide," said Phil Flynn, an energy analyst at PFGBEST.

China, the second largest oil consumer, Saturday, reported that drove inflation rates more quickly in June to 6.4 percent, its highest level in three years. Some analysts worried Beijing might go too far in tightening monetary policy to curb overheating in the economy.

US jobs market at near-standstill

2011-07-11T10:16:00.000-07:00

US stocks dropped sharply as markets opened last night, wiping out the previous day's gains, after disappointing data on unemployment dashed hopes that the economic recovery might be regaining speed.

Job creation in the US slowed to a near-standstill last month, with employers adding the fewest jobs in nine months. The unemployment rate rose to 9.2 per cent.
The US labour department said the economy generated only 18,000 net jobs in June. And the number of jobs added in May was revised down to 25,000.
High gas prices and supply-chain disruptions stemming from the Japan crisis, plus the weak housing market have slowed the economy.
Average hourly wages declined last month and after-tax incomes, adjusted for inflation, have been flat this year.
Businesses added the fewest jobs in more than a year and governments cut 39,000 jobs.
The Dow Jones Industrial Average fell 109.21 points (0.86 per cent) to 12,610.28 in the first 20 minutes of trading.
The broader S&P 500 shed 13.26 points (0.98 per cent) to 1339.96, while the tech-heavy Nasdaq Composite tumbled 27.49 points (0.96 per cent) to 2845.17.
The sell-off came after the US Labor Department reported that the American economy created a paltry 18,000 jobs in June, pushing the unemployment rate up to 9.2 per cent and signalling that US growth stayed very weak during the entire second quarter.
The report was a letdown for investors who had hoped the US economy was getting back on track after being bruised by disruptions from the Japan earthquake and a surge in commodities prices earlier this year.
"Today is going to be a rough day for markets," said Jason Schenker, head of Prestige Economics.
"Light summer trading volumes, coupled with a very disappointing report and misplaced expectations, are likely to yield a lot of red on the screen today," he said.
Caterpillar, a maker of mining and construction equipment whose shares are seen as an economic bellwether, had dropped 1.5 per cent as of midnight (AEST), while General Electric was down 1.7 per cent.
Financial stocks also took a beating, with JPMorgan Chase down 1.5 per cent and Bank of America down 1.7 per cent.
Bond prices rose sharply as nervous investors flocked to US government debt, traditionally seen as a safe-haven investment.
The jobs figures show hiring has slowed sharply in the past two months. The economy added an average of 215,000 jobs per month in the previous three months.
The US economy typically needs to add 125,000 jobs per month just to keep up with population growth. And at least twice that many jobs are needed to bring down the unemployment rate.
The economy and job market are remarkably weak two years after the recession officially ended. Unemployment has topped 8 percent for 29 months, the longest streak since the 1930s.
Unemployment has never been so high so long after a recession ended. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.
The number of unemployed workers rose almost 175,000 to 14.1 million, pushing up the unemployment rate.
Additional reporting: AFP

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Le Nouvel Ardmore, This Apartment Floating in the Air ...

2011-07-11T01:21:00.000-07:00

A new apartment called The Le Nouvel Ardmore, by Jean Nouvel, the world renowned architect and winner of the Pritzker Architecture Prize 2008 and the Wolf Prize in Arts 2005, is present in Singapore. Nouvel designed the apartment with the concept bungalow which floats in the air (elevated bungalow).

This concept allows each building, each with its orientation, forming the same logic of a private room or bungalow in the sky well above the ground. The design of Le Nouvel Ardmore is inspired by the Rubik's cube, which maximizes the quality and the view from space in a modular on the front wall of moving from light and transparency using glass and automatic doors to create conflicts of direction, texture, light, and techniques unusual.

The front of the building is also quite unique since the turn of transparency and light, through the grilles and screens that automatically creates a symphony of infinite variation throughout the day. Substitution of this light favorable views of residents in determining the object and adjust the light into their homes.

In looking outward, building apartment building concept wearing a clean white color and monochromatic towering into the sky. To give a touch of pleasure as a dwelling, adding shades of green are abundant not escape placed by presenting a natural element of green around the room.

Living in this spacious apartment, residents will enjoy the green scenery, fresh air too, and the breeze while enjoying the beauty of the skyline. Enjoyment that can be realized perfectly, especially from the Observatoire, located on floors 26 and 27.

As per his reputation, The Le Nouvel Ardmore gives new definition to the area of the New Ardmore elite with style and a new life. This is well confirmed as a token of appreciation to the monolithic architecture is expressed in a pure and simple by Jean Nouvel, the architect of modern architectural styles adherents.

The apartment was developed by Singapore developer Wing Tai Holdings Limited is located in Ardmore Road, Singapore, one of the main area condo with absolute ownership in Asia. One apartment tower with absolute ownership consists of 43 exclusive residences with an area of 3800 square meters.

Expanxion Sinar Mas Paper Factory

2011-07-10T20:51:00.000-07:00

In the country ( Indonesia ), Sinar Mas oversees a number of paper companies namely PT Tjiwi Chemical Manufacturing Paper Tbk, PT Indah Kiat Pulp & Paper Tbk, PT Pindo Deli Pulp & Paper Mills, and PT Lontar Papyrus Pulp & Paper Industry. The company produces various brands of paper as Sinar Dunia, Bola Dunia and Paperline.

Last year, the production of paper and pulp Sinar Mas had time to sag. In the first nine months of 2009, for example, Indah Kiat only produce 1.4 million tons of pulp. This number is down 12.5 percent than the same period of 2008.

Indah Kiat paper sales to Third Quarter -2009 also fell by 512,435 tons, down 5.8 percent than the same period of 2008 as many as 544,071 tons. As for paper production Chemical Tjiwi during January-September 2009 only reached 733 071 tonnes or 9.5 per cent drop from the same period of 2008 as many as 810 079 tonnes.

Outside the affairs of production down, Sinar Mas is also facing accusations of dumping of paper from the United States. Hence, the understandable if SMG began enlarging the Asian market.

Latest facts even show, the company owned by Eka Widjaja Tjipta this is going to acquire a pulp mill (pulp) in Mackenzie, British Columbia. Through its subsidiary in the Netherlands, Paper Excellence BV, Sinar Mas will buy a factory in Canada is worth 20 million dollars or 19.8 million dollarAS Canada

Rivals fume over Telstra prices

2011-07-10T18:48:00.000-07:00

THE imminent migration of broadband customers to a new Telstra fibre network in South Brisbane has the telco's rivals fuming that the wholesale offers will not allow retailers to offer services at competitive rates.

The fibre-to-the-home network was built after Telstra closed down one of its telephony exchanges in the area to make way for a new Queensland Children's hospital.
Some of the 18,000 broadband services in operation -- a third of which are estimated to be run by Telstra's wholesale internet customers -- have already begun transferring to the new network, with mass migration scheduled from August, but some of the telco's existing wholesale customers are contemplating ceasing services in the area, citing expensive access terms.
Telstra is legally obliged to allow its competitors to lease space in its copper-served telephony exchanges so they can install their own broadband equipment and service customers at better margins, but no regulatory ruling requires that the same terms must apply on fibre networks.
Instead Telstra's competitors wanting to continue serving customers in the South Brisbane area are required to resell and rebrand Telstra services at smaller margins.
Telstra -- which has been liaising with its wholesale customers in the area since announcing its intention to build the fibre network in July last year -- said it had negotiated "competitively priced" wholesale access terms for competitors wanting to use its new fibre network, but some of the telco's rivals said the wholesale costs were up to three times as expensive as the previous copper access terms.
"While Telstra has offered Optus alternative services, they are substantially more costly than unbundled copper-based services. In many cases, the cost of Telstra's wholesale services is equivalent to its retail price," Optus government and corporate affairs general manager Clare Gill said.
Before the copper-based telephony exchange was replaced, Telstra had 32 wholesale customers operating from the South Brisbane area.
Thirteen of those have signed up for the new fibre services.
The new fibre network has also curbed the content serving ambitions of some of Telstra's competitors. While the new Telstra fibre service is capable of delivering download speeds of up to 100Mbps for residential customers, it does not allow retail internet providers to multicast.
Multicasting is a video transmission protocol that reduces transmission costs and allows internet protocol TV to be delivered as an economically efficient service.
"One of Telstra's big shortcomings is that they can't multicast, so it's a definite step backwards to move off copper on to their dodgy fibre," iiNet chief regulatory officer Steve Dalby said.
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Carbon tax to hit profits and growth

2011-07-09T23:51:00.000-07:00

Source: The Daily Telegraph
JULIA Gillard's carbon tax will create an instant inflation spike, slow the domestic economy's already tepid growth and make a dent in company earnings at a critical time in the nation's recovery from the global financial crisis.

As Labor yesterday received the crucial support of independent Andrew Wilkie to push the tax through parliament, economists said the tax would have widespread ramifications for the economy and investors.
The tax, which is likely to price carbon between $23 and $30 a tonne, will raise $11.5 billion in revenue for the government in the first year. It will take effect from July next year.
The details of the tax and the compensation to households and industry will be released tomorrow in Canberra and are likely to increase opposition to the move.
In a report released yesterday, Citi economists forecast that a carbon tax of $25 a tonne would create a one-off 0.8 per cent hit to headline inflation and could shave 0.5 per cent off the economy's growth.
The potential growth blow comes as the Reserve Bank prepares to mark down its forecasts for economic growth this year to just 3 per cent, compared with its earlier call of 4.25 per cent.
Citi chief economist Paul Brennan said the government needed to ensure that the carbon tax did not raise inflationary expectations, which could in turn feed through to a bigger than expected rise in the consumer price index.
"Future increases in the price on carbon would add further to the CPI, but if the adjustment in the price is gradual, as the government appears to be proposing, then the ongoing addition to inflation in future years would be at the margin," Mr Brennan said.
"Of more concern would be whether the carbon tax leads to a change in inflation psychology. It seems unlikely.
"The government is proposing compensation for the price rises and if communicated correctly this should negate any ongoing concerns about a sustained increase in inflationary expectations."
Mr Brennan said Australia's buoyant terms of trade could be under threat if the nation's major trading partners followed suit with similar carbon policies that would lead to a decreased appetite for Australian commodities.
"In the longer term if there is concerted global action to deal with climate change then Australia faces a serious competitive threat, in particular to coal exports," he said.
"A high carbon price in major energy-consuming economies would amount to a lower terms of trade for Australia."
A Goldman Sachs analysis found that a $25-a-tonne carbon price, coupled with 90 per cent compensation for trade-exposed companies with high emissions, would reduce ASX 200 earnings per share growth by up to 0.5 per cent in the first year.
A carbon price of $25 a tonne might lead analysts to downgrade their average earnings per share forecasts by up to 5 per cent.
Goldman Sachs executive director of equity strategy Hamish Tadgell said energy stocks were most exposed to the carbon tax, but the costs would vary across the sector.
"The ability of the integrated utilities to pass on carbon pricing to consumers will ultimately depend on the regulators in each state," as they set retail prices, Mr Tadgell said.
Mr Tadgell said energy companies with emissions above the National Electricity Market average would be hit hardest by the tax.
He said the majors, AGL Energy and Origin, had emissions in line with the electricity market average, and this should mitigate the impact of the carbon tax.
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Door opens to European wines

2011-07-09T05:27:00.000-07:00

French champagne is all the vogue Source: Supplied
AT a time when per capita beer consumption is at a 62-year low, Australian drinkers seem to be developing a taste for finer things, such as French champagne.

The currency boom that has devastated wine exports is a boon for adventurous drinkers, who are increasingly eschewing the domestic stuff for French and Italian wines previously denied to all but the well-heeled.
Over the past five years, wine imports have more than doubled from 26.1 million litres a year to 67.6 million litres, and now account for 15 per cent of sales, up from 3 per cent in 1996.
Many of the imports are from New Zealand, whose sales to Australia have more than tripled over the past five years to $259 million, due to the popularity of Marlborough sauvignon blanc -- a phenomenon local winemakers ruefully call the sauvalanche.
Grant Ramadge, head of Coles' liquor chain Vintage Cellars, said five of his six best-selling wines were from New Zealand, while in 2006 the top sellers were Australian.
But along with grassy whites from across the ditch, Australian drinkers are also discovering a taste for the Europeans.
French imports doubled to $130m over five years while Italian wine is up 58 per cent to $39.6m.
Excluding New Zealand wines, five of the 10 top-selling imported wines are French champagnes, with Moet non-vintage at the top of the heap, followed by Veuve Clicquot at No 2.
Steve Greentree, head of supermarket giant Woolworths' liquor division, said it was not just the currency that was driving the rise in imports.
"There's a desire to try something new and unique, there's a lot of interest in new varietals -- it's not just replacing Australian chardonnay with one from Burgundy," he said.
Meanwhile, Australia's wine exports have grown by less than 1 per cent in volume over the past five years and have fallen by 29 per cent in value, from $2.76 billion in 2005-06 to $1.96bn in the past financial year.
Both the surge in imports and the decline in exports are linked to the surging Australian dollar, which has made imported wine cheaper while also making it impossible for exporters to compete with cheaper producers in countries such as Chile.
The Aussie dollar has risen by 44 per cent against its US counterpart over the past five years, and by 65 per cent against the British pound. Little wonder, then, that Britain and the US, our biggest wine export markets, fell by 6 per cent and 19 per cent respectively in the past 12 months.
At the same time, the Aussie has also risen by 27 per cent against the euro, making wines from the world's oldest winemaking regions more accessible.
Thomas Lambert Laurent, chief executive of French winemaker M. Chapoutier, said his sales to Australia had risen by about 15 per cent for each of the past three years, due both to the dollar and the increasingly discerning palate of Aussie drinkers.
"Consumers are less afraid to drink wine from Italy and France with complicated labels. It's a very interesting time in Australia," he said from the Vinexpo wine conference in Bordeaux.
"Australians have been drinking wine for many years. The new generation is drinking more wine, and their palate is more educated and the taste profile is changing."
Wine consultant and writer Andrew Caillard from Woolworths wine auction business Langton's, said the oversupply problems that had dogged the Australian wine sector for years were also common in European markets, creating further opportunities to find bargain wines from old-world producers.
"Spain has been really struggling, so the market has created some downward pressure on prices, so we've been able to find some great wines from outstanding winemakers," he said after a buying trip to Europe. "Because we're buying these wines direct rather than through an importer, we make huge savings, so we not only pass those on to customers but we pass the benefit on to shareholders while maintaining a very healthy profit margin.
"The imported portfolio over the last two years has expanded hugely -- we've got more Spanish wines, more German wines, we're bringing in some really iconic names, and it's because Australian consumers are interested in it.
"That puts a bit of pressure on Australian producers, but if you're exporting you have to expect that some wine is going to come back the other way as well, and I don't think it's reasonable to expect Australian consumers to be drinking Australian wine every night."
With their market shrinking at home and abroad, Australian winemakers are looking to emulate the success of the resources sector and pitch their tent in China, the fastest growing wine market in the world.
In 2004, China bought less than $10m worth of Australian wine. In the past financial year, however, it took $156m worth of bottled wine and 24 million litres of bulk product, making China our fourth-largest export market.
It's also the fastest-growing, with bottled sales up 32 per cent by value over the past financial year at a time when sales of bottled wine to the US and Britain, our biggest customers, fell by 20 per cent and 33 per cent respectively.
"The Chinese are taking everything we can give them at every price point," De Bortoli Wines' European division general manager Francis Aguilar said.
But Australian winemakers aren't alone in targeting China, with the strongest competition coming from the country whose British market we stole in the 1990s -- France.
French wine has the biggest share of the Chinese import market, with 48 per cent -- more than double Australia's share, which sits at No 2 on 21 per cent.
Professor Tommy Lam, director of Jiao Tung university's wine department in Shanghai, said France established itself in China before other producers, but had appealed to the growing Chinese middle-class desire for prestige.
"France is popular because it was the first into China and people consider it to be the luxury category of wine," he said.
This has created a boom in demand for wines from Bordeaux, France's most expensive region, and driven the price of famous wines such as Chateau Lafite through the roof, with a buyer in Hong Kong last year paying $US230,000 for a bottle of the 1869 vintage.
Australian winemakers shouldn't try to compete by emulating the French, but should concentrate on wines with regional character. "Australia has great potential in the Chinese market, but they're always competing at the middle and lower level because they don't have that icon status," he said.
"But that's OK because in every market there's a small group who will only focus on premium wine, and the rest are the mass market, so there are many points at which you can enter the market."
Prestige aside, Australia's heavier, fruit-driven wines have a natural advantage over their softer French competitors, he said.
"In Asia people drink a lot of spirits, so if they try a wine that is light on the nose they think it's not good quality," he said.
"If you are producing wine that the market will accept, and flavour is very important, then there is room for everyone.
"The Chinese are only drinking one litre each per year at the moment, when countries like Argentina drink 60 litres per year.
"There is room for every winemaking country to sell to China, at least for the next 20 or 30 years."
Key to Australia's success in the Chinese market would be a united marketing effort to establish Australia as a quality producer, he said.
"You need more wine events and exhibitions, but it's important for Australia to come as a brand.
"When it's just one winery among thousands they won't reach the market, you've got to push Brand Australia, so when people think of Australia they think of good wine, like they do with France."
Other so-called new-world producers are also looking to China as the next big market, with South African, Chilean and US producers having established a beachhead.
"We are all trying to figure out China and how to get this big country to share our passion for wine," Wines of Argentina Asia manager Ariel Menniti said. "One thing everyone seems to be doing is to match wines and Chinese food, and it's not surprising that everyone seems to think their wine is the perfect match."
This was illustrated starkly at the Vinexpo conference last month by a tasting session pairing Chinese foods with France's top-shelf sweet wines, sauternes.
"The great sauternes match very well with Chinese foods, especially Szechuanese food, but unfortunately they have been imprisoned as only a dessert wine. With spicy food it's wonderful because the spices enhance the freshness of the wines," Sauterne classified growths president Berenice Lurton-Thomas said.
Isobel Armstrong, Asia-Pacific business manager for South African producer Cape Legends, who has begun exporting to China, said the rapid growth of the market presented problems.
"In China it's a little difficult because everyone and his friend wants to sell wine and they believe there's a lot of potential, but it doesn't mean they will be the right people to sell your brand.
"The Chinese are a contradiction -- they want to get value for money and will bargain you down for a few percentage points just so they feel they've driven a bargain . . . but on the other hand they want the image and the prestige that goes with wine."
Ms Armstrong said she knew of a New Zealand producer who had a separate, inflated price list for Chinese customers because he knew they were prepared to pay more if they were able to get it reduced from the opening price.
Xiamen Fond Wine Import and Export general manager Floyd Wu said Australian producers needed to make more of an effort to educate Chinese consumers about their wines if they wanted to win them away from the French.
"There is very little information in China about wine, other than Bordeaux, which is very fashionable but too expensive for a lot of people."
Meanwhile, China is meeting much of the demand with its own plonk. Next year its wine production is expected to reach 128 million cases, ahead of Australia's expected 121 million.
Strong domestic demand might not be enough to prevent Chinese wine from competing for shelf space with Australian wine in US and British supermarkets in the near future.
But Bruno Paumard, a French winemaker working at Chinese winery Chateau Hansen in Inner Mongolia, said he was exporting "as little as possible".
"We have a really good market in China, and imported wine is quite expensive there due to tax and transport costs, which means we can also sell Chinese wine at these higher prices and make quite a profit with our wine.
"For exporting, we have to cut the price five times, and we only do it for the prestige."
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news.com.au: Prices drop: Sold on saving not spending

2011-07-08T08:59:00.000-07:00

Going, going, going ... potential home buyers are choosing to save their pennies rather than bid for real estate.Picture: File
Source: Herald Sun
Capital city house prices fall 2.7 per cent Sydney the only market to record a rise Brisbane, Perth house price fall biggest
HOUSE prices have fallen almost three per cent so far in 2011 as potential home buyers choose to save their pennies rather than bid for real estate.

The RP Data-Rismark Hedonic home value index shows a 2.7 per cent decline in Australia's capital cities house prices through the first five months of 2011.
In the 12 months to May, prices fell 2.3 per cent, the report said.
RP Data research director Tim Lawless said the housing market was soft as potential home buyers focussed on saving, not spending, because they were worried about the economy.
He added that sales volumes in real estate were about 25 per cent below the five-year average.
Meanwhile, the number of listings was up 25 per cent on the prior year.
"Despite the low rate of unemployment and the strength of the resources sector, it is clear that the average Australian is content to pay-down debt and wait for some economic certainty to return," Mr Lawless said in a statement.
Rismark joint managing director Ben Skilbeck said the high Australian dollar had made local housing more expensive for expatriates, particularly at the luxury home end of the market.
Declines were biggest in the resources-linked cities of Brisbane and Perth, where the median house price fell 5.9 per cent and 7.5 per cent, respectively.
Mr Lawless said house prices in Perth had been falling since late 2007 due to a lack of buyer demand, despite strong population growth and low unemployment in the West Australian capital.
The report, which was released today, showed Sydney was the only market to have recorded a rise in property values in the year to May, with house prices in the Harbour City up 1 per cent.
In brighter news, the report said rental yields had improved and Mr Skilbeck said vacancies remained very tight.
"We are not looking for any capital gains in 2011," Mr Skilbeck said.
"Total returns will be boosted by very solid growth in rents, with gross yields in May now at five per cent for Aussie apartments."
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news.com.au: Loan pain as mortgage entry fees explode

2011-07-06T17:24:00.001-07:00

Mortgage exit fees are causing huge increases in loans / File
Lenders lift "front-end" fees Reaction to ban on exit fees Costs spread across new borrowers
NEW home loan customers are being hit by massive increases in upfront mortgage fees because of the Federal Government's ban on exit fees.

Three lenders have already lifted their "front-end" fees by up to several hundred dollars with a "flood" of higher charges expected from other lenders when the ban kicks in tomorrow.
Interest rate watchdog Mozo.com.au yesterday revealed Aussie, ME Bank and Greater Building Society had all ramped up their application and start-up fees ahead of the Government's ban.
Treasurer Wayne Swan was warned by the finance industry that the ban would worsen competition in the mortgage market by forcing lenders other than the four major banks to increase their application fees.
"This seems to confirm fears that smaller lenders will be most hurt by the exit fee ban and will need to re-price their loans accordingly," Mozo managing director Rohan Gamble said yesterday.
According to Mr Gamble, front-end fees have been increased by up to $500 in one case and others are expected to follow suit after July 1.
Mitchell Watson, an analyst at financial research company Infochoice, said he had already received one notification from a lender about an increase in application fees and he expected a "flood" of higher charges tomorrow.
"This was always going to be the position and what the industry warned about," Mr Mitchell said.
According to one of Australia's largest mortgage brokers, Resi, Treasurer Wayne Swan's new policy will hurt new borrowers, whereas exit fees only applied to those people who paid off their mortgage early or who wanted to switch lenders.
"On behalf of all consumers, I feel sick about it. They're paying additional fees because the Government's banned exit fees," Resi chief executive Lisa Montgomery said.
"Those extra costs now will be spread across all new borrowers. Everyone will pay now, not just those lucky enough to pay off their mortgage early," Ms Montgomery said.
A spokesman for Treasurer Wayne Swan said: "Lenders use exit fees to shackle Australian families to their mortgages, not to raise revenue. The fees are there to stop consumers switching. We've given the Australian Securities and Investments Commission the power to crack down on any unfair mortgage fee used to gouge customers, whether it's an entry fee or any other type of fee," he said.
"The Government's banking reforms are all about giving Australian families the freedom to walk down the road and get a better deal."
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news.com.au: Backyard blitzed as Aussie dream shrinks

2011-07-06T11:22:00.000-07:00

House prices in Australia's capital cities have fallen 2.7 per cent through the first five months of 2011.

Roxanne Lawrence, Enrico Sedita and son Jordayne, 15 months, at their 266sq m Maroochydore house block. Picture: Megan Slade Source: The Sunday Mail (Qld)

THE great Australian dream faces a major reality check, with new home buyers being offered house blocks a quarter the size their parents bought.

As developers look to meet a market with more affordable house-and-land options, lot sizes are being squeezed to less than 200sq m for the first time.
Back yards, which have been shrinking for decades and in recent times have been swallowed by a pool and deck, may soon disappear.
Queensland developers have been closely following the downsizing trend, which has surged in the US since the global financial crisis, and sprouted in Western Australia, South Australia and Victoria.
John Thurtell, general manager of Sunshine Coast-based builders PJ Burns, recently returned from a fact-finding mission to the US where he toured master-planned communities.
Mr Thurtell said the era of the McMansions had ended and small lots were in demand.
"We are now making sure we are ready for the arrival of rear-loaded blocks here. This could be as soon as the end of the year," he said.
A rear-loaded, or laneway, lot is one where a garage is built at the back, allowing car access via a laneway.
"There could be house-and-land packages for around $320,000, so it's very exciting news for those looking to buy their own home. We think they will sell like hotcakes."
Mr Thurtell admitted yards would disappear and "terrace" block sizes would be as small as 7.5m by 25m (187sq m total).
Mr Thurtell said the loss of the back yard followed a trend where people were happy to have low-fuss outdoor areas and pursue social and sporting interests away from home.
"There will need to be great innovation for us to provide three-bedroom homes with an ensuite, double garage at the back, walk-in robes and a drying court. We are looking to caravans and even boats for inspiration," he said.
Developer Stockland, which has the 50,000-resident Caloundra South project on its books, will release 111 lots between 187sq m and 250sq m at its Bellvista II estate at Little Mountain by early 2012.
The Urban Land Development Authority is close to amending and finalising its blueprint for Caloundra South, which could be approved by the Queensland State Government as early as October.
Stockland Sunshine Coast development manager Troy Wainright confirmed Stockland was working with council and the ULDA on plans to introduce a range of affordable housing and smaller block sizes into its communities.
"This is not just about affordability, but also liveability. More efficient block sizes situated near parks, public transport, places of employment and other amenities will make people less reliant on their cars," Mr Wainright said.
Investa Property Group's Queensland general manager Bruce Harper said it was inevitable more rear-loaded blocks about 200sq m would be included in upcoming estates, including his company's 7500-home Palmview project. Mr Harper said 5 per cent of homes in new communities were single storey, but he predicted this would rise to 40 per cent within five years.
Leading social analyst David Chalke said the rise of the small block was inevitable as the great Australian dream received a timely reality check.
"The days of kids kicking the footy with dad in the back yard are over and sporting pursuits are now likely to be more formal, organised - and expensive," he said.
Mr Chalke said smaller house-and-land packages would open up the market and be a better use of resources.
He said for many, it also was a more attractive option than high-rise living.
Lot sizes as small as 187sq m (7.5m wide by 25m deep) will be offered as part of southeast Queensland developments by early 2012Official pricing has not been set, but industry sources say they could be priced between $130,000 and $150,000, with house-and-land packages from $320,000Only 2 per cent of blocks in new estates are larger than 600sq m
Average block sizes:
1950s: 32-36 perches (810sq m-910sq m)1980-90s: 600sq m2000s: 350 - 450sq m2012: 200sq m - 350sq m
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news.com.au: Ads help NAB claw back mortgages

2011-07-06T09:47:00.000-07:00

NAB has made a post-financial crisis resurgence after an advertising campaign featuring a "break-up" with rivals / File Source: Bloomberg

NATIONAL Australia Bank chief Cameron Clyne's fight for a larger share of Australia's mortgage market continues to bear fruit.
NAB increased mortgage lending 15.8 per cent in May compared with the same month a year earlier, according to Credit Suisse analysts.
Rivals Commonwealth Bank, Westpac and ANZ posted slower growth in mortgages, which account for 63 per cent of all lending.

NAB has made a post-financial crisis resurgence after Mr Clyne scrapped fees, cut loan rates and began an advertising campaign featuring a "break-up" with rivals.
The strategy is not without risks as ratings downgrades and the weakest credit demand in three decades threaten banks' profits.
"They're clearly gaining market share, and the stock price is reflecting a strong improvement relative to peers," said Mark Nathan, who helps manage about $5 billion of assets at Arnhem Investment Management.
"What isn't clear is the profitability of that gain in market share and the quality of customers they're packing in."
NAB's outperformance comes amid mounting concern about the profitability of the nation's lenders. Having weathered the turmoil unleashed by the 2008 collapse of Lehman Brothers without government bailouts, the banks face tumbling demand for home loans after the Reserve Bank boosted borrowing costs seven times between October 2009 and last November.
In the process, RBA governor Glenn Stevens has crunched household appetite for debt, which more than doubled in the past 15 years as a proportion of disposable income to 155 per cent in the March quarter.
That is higher than the 133 per cent ratio Americans accumulated at the height of the US subprime mortgage boom.
Credit to home buyers in May increased at the slowest annual pace since 1977, when RBA data began.
CBA accounted for 29 per cent of the mortgage market in May, Westpac had 27 per cent, followed by National Australia's 16 per cent and ANZ's 15 per cent, according to APRA figures.
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news.com.au: ABS data won't change rate outlook

2011-07-06T06:32:00.000-07:00

THE outlook for interest rates is unchanged despite the release of weaker than expected retail trade and building approvals data, economists say.
The Reserve Bank of Australia (RBA) last increased the cash rate in November 2010 from 4.5 per cent to 4.75 per cent and most economists expect the next rise to be in August.
Australian residential building approvals data was released today, showing a fall of 7.9 per cent in May, much larger than the 0.5 per cent drop economists were expecting.
In the year to May, building approvals were down 14.4 per cent, the Australian Bureau of Statistics (ABS) said.

JP Morgan economist Ben Jarman said the drop was payback for gains in recent months.
Westpac senior economist Matthew Hassan said both sets of data show that the consumer and interest-rate sensitive sectors are still fairly weak, but not as poor as the headline suggests.
He said retail sales figures were softer than expected, mainly due to a technical correction, following a particularly strong result in April.
"The April data was simply too strong," Mr Hassan said.
"We think that there are some technical issues around the impact of weather events and volatility in this seasonal series.
"For us, this is a number that brings trend back in line with where we thought it was ... at about 0.3 per cent a month."
Mr Hassan said that dwelling units data was also weaker than expected, partly due to volatility in the data.
"Apartment approvals were down 20 per cent, particularly in NSW and Victoria.
"(But) if you look at the larger, more stable private sector houses component, it was a less negative story."
He did not expect the data to change the central bank's outlook for monetary policy.
"Given that, we're pessimistic on the outlook for new building, we thought that would be delivered in May, but it was even more weaker than expected.
"It is pretty consistent with our story for the housing market, we've got this looming prospect of further rate hikes.
"With the first home-buyer pretty much absent in the market, it will be pretty much hard to achieve any gains in new dwellings."
Mr Jarman expects the RBA to next lift the cash rate in August, which is unchanged from the previous JP Morgan forecast.
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news.com.au: Builders worried as stimulus fades

2011-07-06T05:00:00.000-07:00

BUILDERS are worried there will not be enough private sector work available when the Federal Government stimulus programs end.
Releasing the latest Master Builders Australia (MBA) national survey, chief economist Peter Jones has also warned of anecdotal evidence of uncertainty in the industry due to the government's proposed carbon tax.
"The survey shows work on builders' books holding up reasonably well in the June quarter, but it remains to be seen for how long this can continue given the winding down of stimulus projects and a less than positive outlook for new work," Mr Jones said today.

Building stimulus measures introduced during the height of the global financial crisis included the school halls and social housing projects.
The survey indicated that there was no sign of an upswing in residential building conditions.
At an index of 48.4 points in the June quarter, down from 51.4 in the previous quarter and below the 50 mark, it suggests that residential building conditions will be slightly softer in the next six months than the previous six months.
The index representing builders' own current business conditions also eased, but held above the 50 satisfactory market, moving to 55.7 in the June quarter from 56.3 in the March quarter.
But builders sentiment held up at 56 points.
Profitability slipped and sales stayed weak, while hiring plans suggested that workforce is likely to remain essentially unchanged in the period ahead.
The survey also found that 26.6 per cent of respondents were concerned about the availability of finance having a constraining effect on their business, only a modest improvement on the previous quarter.
"Interest rate speculation continues to hang over the industry, with the risk of heavy-handed interest rate policy still a real threat to all sectors of building an construction," Mr Jones said.
"With large parts of the building and construction industry doing it tough, the Reserve Bank should keep interest rates on hold until a private sector recovery is able to gain momentum."
The central bank holds its monthly board meeting tomorrow, but economists expect it to keep the cash rate at 4.75 per cent for another month.
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news.com.au: 'Interest rates on hold until August'

2011-07-06T03:17:00.000-07:00

Cash rate steady in July - economists RBA eyes weaker domestic, global data Rate rise forecast for August
THE Reserve Bank of Australia is expected to hold interest rates steady when it meets tomorrow but a hike is tipped next month to temper the effect of the aggressive growth of the mining boom.

Economists have widely agreed the RBA would keep the cash rate at 4.75 per cent tomorrow but HSBC economist Paul Bloxham said recent RBA announcements reaffirmed the view that rates would need to rise by more than 50 basis points over the next 12 to 18 months to contain inflation, The Australian reports.
"We think the next hike will be August and are still calling for 100 basis points by mid-2012," he said.
"However, recent weaker domestic and global data suggest the risk is that it will take longer before rates rise, and that the whole process may be more elongated. Nonetheless, we think the risk that the next move is down . . . is very small.
"Overall, our view is that the current softer patch is largely temporary, reflecting some transition dynamics for an economy that is becoming more mining sector dependent, and that the underlying economy will continue to strengthen over the forecast horizon."
AMP Capital chief economist Shane Oliver said although he expected the RBA to maintain its inclination to raise rates at some point on the back of the mining boom, there was no urgency.
"Consumers remain cautious, house prices are falling, credit growth is tepid, the labour market has slowed and business confidence is soft, and so unless June quarter inflation data surprises on the upside at the end of the month, there is no need for an interest rate hike any time soon," he said.
Read more on this story at The Australian.
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news.com.au: Caution keeps loan ratios down

2011-07-06T01:59:00.001-07:00

Smaller mortgages are in vogue as house prices soften in Australian capital cities / File Source: The Daily Telegraph
AUSTRALIANS are borrowing less as house prices slide, further entrenching the culture of debt reduction set in train by the financial crisis.
People taking out mortgages last month signed up for smaller loans relative to the value of their property than at any time during the previous six months, according to data from Australia's biggest mortgage broker.
Australian Finance Group statistics show that the average loan-to-value ratio was 64.2 per cent nationally, and the average ratio fell in Victoria, New South Wales, South Australia and the Northern Territory.
Smaller mortgages are in vogue as house prices soften, and in June the average mortgage across Australia was $384,042 - about 1.1 per cent lower than the previous month.

The average mortgage waned in all states except NSW and Western Australia, where it grew 0.5 per cent and 3.3 per cent.
In a sign that Queensland is continuing its gradual recovery from the summer disasters, mortgage sales reached the same level in June as they did in the same month a year earlier for the first time in five months.
Residential property remains subdued, with annual housing credit growth slowing to almost 6 per cent, compared with an average 14 per cent in the past 34 years.
Reserve Bank governor Glenn Stevens yesterday noted the slowdown in household credit and in values of assets.
The central bank gave borrowers another reprieve, leaving the overnight cash rate at 4.75 per cent.
UBS analyst Jonathan Mott last week told clients he expected housing credit growth to slow further thanks to pressure on household budgets caused by higher interest rates and utility, food and petrol prices.
UBS predicts housing credit growth to slow to 4 per cent by 2013, and personal lending to fall to 2 per cent.
For those intent on borrowing or refinancing, deals abound thanks to the big banks muscling in to grab another 1.7 per cent share of the mortgage market in June from their smaller competitors.
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Shares recover from Portuguese downgrade to close higher

2011-07-06T01:48:00.000-07:00

By finance reporter Jesse Leary

Posted 1 hour 4 minutes ago

Local shares finished the day slightly ahead, recovering from early falls which were led by the banking sector.

The All Ordinaries closed up 7 points to end up at 4,664, while the ASX 200 also added 7 points to close at 4,605.

The big banks weighed on the market after ratings agency Moody's downgraded Portuguese banks to junk status.

The agency believes there is a growing risk the country will need a second bail-out before it is ready to borrow money from financial markets again.

The major banks were down well over 1 per cent around midday, but have recovered a bit.

National Australia Bank closed down the most, losing 0.6 per cent to $24.99.

ANZ and Westpac did the best, down just 0.2 per cent.

Among the miners, Rio Tinto reversed earlier losses, adding 28 cents to close at $83.60.

BHP Billiton gained 0.5 per cent to $44.45.

Agricultural company Elders says the suspension of live cattle exports to Indonesia could cost the company up to $7.3 million.

However the company, which owns feedlots and abattoirs in Indonesia, says these figures are yet to be tested and verified.

Shares in Elders dropped by 1.3 per cent during the day's trade.

Retailers are doing better after suffering falls across the sector yesterday.

Harvey Norman and Myer added about 2 per cent, while major retail chains Woolworths and Wesfarmers both edged ahead.

Telstra shares finished flat on the day - the telco announced it will merge the sales and customer service sections of its business in preparation for the rollout of the National Broadband Network.

The new section is set to begin operating next month.

Currencies and commodities

The Australian dollar was buying 107.2 US cents, 74 euro cents, 86.7 Japanese yen, and 66.9 British pence around 5:00pm (AEST).

Spot gold was worth $US1,517 an ounce.

West Texas crude was higher at $US96.90 a barrel.

Tapis was also higher at $US120.10 a barrel.

Source: www.abc.net.au