Inflation is heading to the upper end of the Reserve Bank of Australia’s (RBA) target band of 3.0 per cent following price rises in alcohol, tobacco and fruit and vegetables, a survey shows.

The TD Securities Melbourne Institute monthly inflation gauge rose 0.2 per cent in August, following a 0.1 per cent rise in July and a 0.3 per cent rise in June.

It says an official interest rate rise is now on the cards, but the central bank has some breathing space until at least the end of the year.

“In the 12 months to August, the inflation gauge rose by 3.0 per cent, resting on the upper bound of the RBA’s two to three per cent inflation target band,” TD Securities said in a statement.
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Borrowers are likely to be spared an interest rate rise from the Reserve Bank of Australia (RBA) on Tuesday because of a series of mixed economic indicators over the past month.

All 15 economists surveyed by AAP this week said they expected the RBA to leave the cash rate at 4.5 per cent after the central bank board meets for its regular monthly meeting on Tuesday morning.

But analysts are less sure about when the next rate rise will happen, with seven of the 15 surveyed expecting a rate rise of between 25 and 50 basis points in the final three months of 2010.

A 25 basis point (quarter of a per cent) rate rise will add about $50 to the monthly repayments on a $300,000 mortgage.
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By Jill Fraser for Lending Central

Just when things were starting to look up (certainly from where I sit they were - we survived the GFC, employment and consumer confidence are picking up, competition is returning to the mortgage industry, the media is using the word ethics and broker in one sentence and housing prices are simmering along) a dark grey cloud descends over our future.

First we have Four Corners telling us on Monday night that the greatest financial crisis we will ever see is yet to come (the prediction being that many countries will see their debt reach 100 per cent of their Gross Domestic Product in the days to come) and now BIS Shrapnel has released a long term forecast that warns of high inflation and interest rates that top 9 per cent.

Leading industry analyst and economic forecaster, BIS Shrapnel says whoever forms Government will confront a sluggish economy with no real growth drivers over the next few years.
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Australia is well placed to deal strongly with another global financial crisis, should one arise, federal Treasurer Wayne Swan says.

“We are very well placed to make judgments should those events occur, but those events are not in train as we speak,” he told Network Ten on Sunday.

“We know there is more unexpected weakness in the United States economy, but we would deal with those conditions should they arise in the same way in which we have dealt with them over the previous two years - very strongly and very effectively.”

When it comes to the Australian economy, investors are more worried about the unresolved impasse of a deadlocked parliament.
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Press Release

Aussie has seen a surge in the number of first homebuyers requesting appointments with its brokers as they step back into the property market.

The number of FHB’s requesting appointments with Aussie brokers via the website www.aussie.com.au has more than doubled since March.

Aussie CEO Mr Stephen Porges said a combination of the cooling property market, an improved economy, and increased job security has spurred FHB’s back into the game.
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Credit Union Australia (CUA) is set to double its size within five years as it ramps up its campaign to win more customers and compete against regional banks.

Australia’s largest credit union is aiming to increase its assets under management from $8 billion to $16 billion and obtain a credit rating.

It will also increase its marketing expenditure by 50 per cent in 2010/11 to raise its profile.

Chief executive Chris Whitehead said CUA wanted to be positioned in consumers’ minds as an institution on the same level as the three regional banks, appealing to those who are disenchanted with the big four banks.
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Perhaps this has all been some sort of weird dream and we’ll suddenly wake up to find Kevin Rudd still in charge.

But if you pinch yourself, you’ll find this post-poll epic is very real, even if the events seem so surreal.

The eventual winner of this electoral odyssey will take or remain in control of a $1.2 trillion economy that is pounding along at a healthy clip, as next Wednesday’s national accounts are likely to reveal.

Economists are predicting a gross domestic product (GDP) outcome of around one per cent growth for the June quarter, lifting the annual rate close to three per cent.
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The Australian Office of Financial Management (AOFM) has sold $700 million of Treasury Bonds that mature on December 15, 2013, at a weighted average issue yield of 4.386 per cent.

The bonds carry a coupon rate of 5.50 per cent.

Bids accepted ranged from yields of 4.385 per cent to 4.390 per cent.

The coverage ratio - the ratio of bids received to the value of bonds offered - was 3.79.
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By Jill Fraser for Lending Central

Whichever political party breaks the deadlock and forms government could do much more to enhance competition within the mortgage industry maintains RESI Mortgage Corporation’s recently appointed CEO, Lisa Montgomery.

“It’s not on the radar of either side because neither has a full understanding of the issues. Ironically some of the decisions made in the so-called spirit of competition have flown in the face of it.

“So the only way we can really move forward is to create our own competitive edge,” says Montgomery who believes that the non-bank sector will be struggling to claw back the market share it lost to the Big Four banks during the GFC.

“But we’re certainly doing whatever we can to encourage borrowers to put non-banks, building societies and credit unions on their shopping lists.”

Montgomery spoke to Lending Central about her plans for RESI, the MFAA and the gender divide in the industry.
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By Jill Fraser for Lending Central

Financial services group, Wealth Today began life as a mortgage broking business. Mid 2009 it was reborn as a decidedly more innovative entity that incorporates a financial advice academy and a financial business solution model for mortgage brokers.

Managing Director, Tony Pennells vigorously resists any attempt at labelling the new venture preferring the bigger picture perspective that sees his company as “part of the evolution within the financial services industry”.

Pennells’ decision to expand the company’s parameters came when he recognized that there was a missing piece in the financial services sector after Wealth Today failed to secure a national joint venture with a financial planning company. (Their aim was to close the gap that prevents brokers being unable to give personal advice.)
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Press Release

Intellitrain has experienced massive growth in its CPD webinar program.

3 new aggregators have recently begun to promote the program internally to their members as a way of obtaining up to 18 CPD Points per year and quality training & development without having the cost of travel and parking.

Paul Eldridge, Intellitrain’s CEO says “The most pleasing aspect of this for us is that we have received feedback from brokers and loan writers who have been applying what they have learned and it’s worked!”
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Australian Home Loan Lender, Mortgage House has released an exciting new product to the market.

The fully featured ‘Altitude Home Loan’, offers up to 99% Loan to value ratio with no ongoing account keeping fees.

It also provides borrowers with the opportunity to reduce debt by providing access to a 100% offset account, allowing them to have salary and income deposited directly to the account.
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Wayne Swan must have felt like Winston Churchill when he woke up this morning.

The Labor Treasurer may have been in the box seat when Australia won the battle against the worst global recession since the Great Depression, but his side could well have lost the war against the coalition after just one term in power.

When the dust settles from this weekend’s so far inconclusive election, and the haggling with crossbench independents is finished, Mr Swan could be handing over his treasurer’s crown and a $1.2 trillion economy to Liberal Joe Hockey.

Bookies certainly think so.
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When interest rates begin rising again - and be assured that they will - don’t blame the winner of the federal election on Saturday.

Don’t blame the Reserve Bank of Australia (RBA) either.

Blame the natural resource curse.

A bountiful supply of resources can be a blessing, of course.

Especially when the prices of primary commodities rise, as they have in the past year - by 51 per cent according to the commodity price index compiled every month by the Reserve Bank of Australia (RBA).
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Over two-thirds of people who refinanced their home loans recently were able to secure a lower interest rate, a mortgage broker’s survey shows.

The survey also found that 54 per cent who refinanced changed their loan product and lender when refinancing, while 46 per cent stuck with the same lender but changed their loan product.

Sixty eight per cent of respondents who refinanced in the last 12 months were able to reduce the amount of interest paid, according to a Mortgage Choice survey of 1,028 home loan refinancers.
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