🗞️ Liar liar

Good morning. An AI safety firm had several frontier models run competing simulated vending machines for a year to see how they'd behave with no human oversight.

They lied, colluded on prices, bribed and betrayed each other, with Claude’s Opus 5 breaking 11 separate truces and plotting to undercut the very rivals it proposed teaming up with.

It won and set a record, but researchers reckon it’s exactly why these agents aren't ready to be trusted running anything unsupervised just yet.

All the headlines and more below...

6 IN 10 AUSTRALIANS NOW NEVER BUY ANYTHING AT FULL PRICE

Australians spent $21.9B online in the March quarter, up 14% year on year, as households doubled down on discount shopping. Nearly 60% of consumers said they never pay full price anymore, and 58% said they now look forward to major sales as planned spending events rather than one-off opportunities.

Online marketplaces captured the largest share at $5.1B, or 42% of total spend. Food and liquor followed at $4.4B, while fashion hit $3.1B. Millennials remained the biggest spenders at $7.8B for the quarter, followed by Gen X at $6B and Gen Z at $3.8B. Australians born before 1946 recorded the steepest annual increase of any generation, up 18%.

The report also flags the continued rise of the "Lipstick Effect", where consumers cut back on big-ticket discretionary items but keep buying smaller, affordable indulgences that feel manageable under budget pressure. Average basket size fell to a record low of $90.

AUSTRALIAN NEWS

• The Australian health sector has remained the most hacked in 2025, accounting for 19% of reported breaches as criminals deploy autonomous robots and Australians demand stronger AI safeguards. LINK

• The NSW government has ordered Sydney councils to prepare 30-year housing density plans as a commission finds it costs over US$1M to build a typical mid-rise apartment. LINK

• The ATO scrapped a recent recruitment round for audit and compliance officers earning US$84,000 to US$100,000 after AI was wrongly used to screen candidates against policy. LINK

• The NSW government unveiled four revamped export support initiatives, including 13 Export Capability Building Program workshops through FY27, to help small and experienced businesses expand internationally. LINK

• Several prominent queer venues in Melbourne and Sydney have had their Meta accounts wrongly suspended since mid-July, cutting advertising to zero, as automated moderation tools misflagged their content. LINK

INFLATION FALLS TO 3.6%; TRIMMED MEAN AT 3.8% - BELOW RBA'S 3.8% FORECAST

The trimmed mean measure held at 3.6% in the year to June, below the RBA's forecast of 3.8% and market expectations of 3.7-3.8%, while headline inflation fell to 3.8% from 4% in May.

Housing costs rose 6.8% over the year, the largest contributor to inflation. New dwelling costs are up 5.8%, the highest in almost 3 years, as builders pass on higher material and labour costs. Electricity prices are 22.4% higher than 12 months ago, largely because government rebates that reduced household bills have ended.

Petrol prices fell 10.9% in June as oil prices stabilised after Middle East tensions, while the federal fuel excise discount of 32 cents per litre remained in place. That discount was cut to 16 cents in July and ends Sunday.

COMPANY NEWS

• The CMA has opened an investigation into Microsoft’s Copilot pricing in Microsoft 365 after Australian ACCC court action, focusing on automatic higher-priced plan renewals. LINK

• Meta has launched its latest AI-powered smart glasses in Australia, offering influencers and small businesses wearable cameras and content tools while facing criticism over privacy concerns and "creep goggles" branding. LINK

• Microsoft reported fiscal Q4 Azure cloud revenue growth of 43%, beating the 39.98% estimate as Azure revenue surpassed US$100B and Microsoft 365 Copilot exceeded 30M paid seats. LINK

• Harris Farm Markets surpassed more than US$1B in sales and plans almost 12 new stores. LINK

• Domino’s Pizza reported a 4.1% fall in same-store sales for 2026 as it lifted prices and cut discounts, while franchisee profitability rose 11.3% and goodwill impairments reached US$116.2M. LINK

• Rio Tinto reported US$6.66B in half-year net profit after tax, a 47% year-on-year rise driven by higher copper, gold and aluminium prices and portfolio diversification. LINK

• Elite Eleven has transformed a COVID-era pop-up into a 525 sqm concept store at Highpoint Shopping Centre, replacing a 150 sqm site and targeting over US$150,000 in opening-weekend sales. LINK

• Grant Thornton has agreed to buy US rival CBIZ for US$5B to create the fifth-largest US professional advisory firm. LINK

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CHART OF THE DAY

ONE MORE SCROLL

Editor’s Pick: 11 African elephants rewilded on South African reserves display many wild-like behaviours after long captivity, though stress indicators remain uncertain.

Draft Pick: Lachlan Kennedy has broken the Australian men’s 100m record with a 9.8s run to win Commonwealth Games silver in Glasgow.

Doctor’s Pick: Is washing your face with bar soap effective?

TRUE OR FALSE

1. The world's shortest commercial airplane flight lasts less than two minutes.

2. Human stomach acid is strong enough to dissolve a stainless steel razor blade.

3. A penny dropped from the observation deck of the Empire State Building can kill a person if it strikes them on the head.

4. The very first item ever scanned with a barcode in a supermarket was a can of Campbell's Soup.

5. Snails are capable of sleeping for up to three years consecutively.

Answers below

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ANSWERS

1. True. The Loganair flight between the Orkney islands of Westray and Papa Westray in Scotland covers a distance of just 1.7 miles. The scheduled flight time is 1.5 minutes but with a good tailwind, the trip has been completed in just 53 seconds.

2. True. The human stomach produces incredibly harsh gastric acid (mostly hydrochloric acid) with a pH level between 1.0 and 2.0. In laboratory studies simulating the stomach environment, this acid has been shown to significantly dissolve single-edged razor blades after just 24 hours of immersion.

3. False. A penny is far too small, flat and light to become a lethal weapon. Because of air resistance, a falling penny reaches its terminal velocity (maximum speed) at about 25 to 50 miles per hour.

4. False. On June 26, 1974, the first product to ever be successfully scanned using a Universal Product Code (UPC) barcode at a retail checkout counter was actually a 10-pack of Wrigley's Juicy Fruit chewing gum at a supermarket in Troy, Ohio.

5. True. Certain species of land snails can go into a deep hibernation or estivation when the weather is too extreme (either freezing cold or severely dry) and food is scarce. They secrete a layer of thick mucus over their shell opening to seal in moisture and can remain in this dormant survival state for up to 3 years until environmental conditions improve.

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