THE NEWS WRAP: RBA warns of non-mining investment slump
RBA deputy governor Philip Lowe is warning business investment outside the mining sector remains at its lowest levels since the 1990s recession, due to the lingering effects of the global financial crisis.
“While recently we have seen some return to risk-taking in financial markets, potential owners of real capital in the developed economies have not yet been prepared to step forward in significant numbers and take a risk,” Lowe says.
“Consumer demand has been soft and businesses have wanted to wait and to see what happens … this change in corporate attitudes is, I suspect, one of the enduring but underappreciated consequences of the financial crisis.”
Wesfarmers chief says post-election boost was a temporary blip
Wesfarmers chief executive Richard Goyder says sales in the retail sector remain sluggish, dashing hopes of a post-election bounce.
“In the last two to three weeks prior to the election there was some impact, probably in discretionary more than non-discretionary,” Goyder says.
“The week after the election was very strong for us, but it went back to normal pretty quickly.
“Australians continue to save, and there seems to be… a fair amount of cash sitting around, so hopefully people will bring their wallets out in the next couple of months.”
123 jobs squeezed out by Golden Circle
Golden Circle has announced it is closing its Mill Park factory, in Melbourne’s outer-northern suburbs, with 123 jobs set to go in March next year.
The company announced it will move its food production to an existing factory in Northgate, Queensland.
“This is in no way reflective of the performance of the Golden Circle team at Mill Park,” Golden Circle marketing general manager Simon Leonard says.
“The site is small and the capital investment required makes it too costly to continue to operate.”
The Dow Jones Industrial Average is up 0.62% to 15509.21. The Aussie dollar is at US96.26 cents.