Get used to high dollar, says resources forecaster
Australia’s dollar will remain painfully high for the rest of the decade, eroding profits of the biggest exporters and weighing on federal budget revenue for years to come, a high-level government report predicts, according to the Australian Financial Review.
In a rare official prediction that runs counter to Treasury forecasts, the Bureau of Resources and Energy Economics (BREE) says the dollar will remain at close to its record high for the next five years.
BREE’s prediction is a significant challenge to the conventional view that the dollar will fall in tandem with likely declines in prices for Australia’s biggest exports, such as iron ore and coal.
Treasury in its mid-year update said it expected the dollar to ease by about 1¢ against the US dollar every year over the next 10.5 years.
Inflation may turn Beijing’s boom into bust, says economist
China’s financial system is a “time bomb”, its real economy is weak and structural issues abound, according to a leading economist who has joined the chorus of doom surrounding Australia’s biggest trading partner, reports the Australian Financial Review.
Dong Tao, chief regional economist at Credit Suisse, said there was “no good news” to report on China, where he saw an unsustainable credit bubble fuelling inflation that would inevitably lead to higher interest rates.
“Despite GDP growth stabilising, the Chinese economy is struggling,” Tao said on Wednesday.
Polluters face audit squeeze
Big polluters have been warned to engage auditors now to check their complex emission reports under the carbon scheme, according to the Australian Financial Review.
The warning by the federal government’s clean energy regulator to companies liable to pay the carbon tax comes amid concerns about stretched carbon audit resources.
More than 100 of Australia’s largest emitters will be significantly affected by the new requirement to have a “reasonable assurance” audit, the most comprehensive form of greenhouse and energy check.
Under the National Greenhouse and Energy Reporting Scheme, companies that emit more than 125,000 tonnes of carbon will be required to undertake an independent assurance audit of their emissions by October. The audits are on top of a number of checks of individual companies being conducted at the request of the regulator.
