🗞️ Met Gala

Good morning. The Met Gala, one of fashions most popular and pricey events, took place yesterday.

Tickets were said to have cost $100,000 USD per person…

All the headlines and more below...

RBA HIKES RATES FOR THIRD TIME IN A ROW. AVERAGE MORTGAGE UP $227 TO $453 A MONTH.

The RBA lifted the cash rate to 4.35%, the third consecutive increase. Governor Michele Bullock blamed inflation that was already too high before the Middle East conflict, and said the war has made the trade-off between controlling prices and protecting growth "much worse."

Bullock said it's "quite possible" there wouldn't have been a third hike without the war. The conflict pushed up oil, energy and commodity prices. "Australians are poorer because of this shock. We are all feeling poorer, and there is no way out of that."

The bank's forecasts show the cash rate hitting 4.7% by December, then sitting between 4.6% and 4.7% through mid-2028. The next meeting in June is a hold with the RBA wanting space to see if inflation eases or if the war drags on.

Only Macquarie has passed the hike on so far.

AUSTRALIAN NEWS

• The RBA has lifted the cash rate by 25 basis points to 4.35% for a third consecutive hike in an 8-1 vote and is pausing further rises while warning that expansionary budgets and Middle East-driven fuel costs risk keeping inflation above earlier forecasts. LINK

• Macquarie Bank has become the first major lender to pass on the RBA’s cash rate rise from 4.1% to 4.35% in full to variable customers, adding about $91 a month to a $600,000 mortgage. LINK

• Australia and Fiji are close to signing the Vuvale Union security pact as the Albanese government deepens Pacific defence ties after deals with Tuvalu, Nauru and Papua New Guinea. LINK

• The government has moved to scale back its EV fringe benefits tax break by replacing the full exemption with a permanent 25% discount, saving $1.7 billion over four years. LINK

WESTPAC JUST ADDED $200M TO ITS BAD DEBT BUFFER. LOANS IN DEFAULT ARE ACTUALLY FALLING.

Westpac set aside an extra $200M for potential loan losses in the first half, even as the number of borrowers behind on repayments dropped. Stressed loans fell to 1.16% of total exposures, down from 1.28% six months earlier.

The bank is pricing in two more rate rises (pushing the cash rate to 4.85%), plus unemployment climbing from 4.3% to 5% by early next year. CEO Anthony Miller flagged exposure to energy-intensive sectors as a specific concern, though customer behaviour hasn't shifted yet. NAB and ANZ have also topped up bad debt provisions in recent weeks, both citing the energy shock.

The March rate rise only just started hitting borrowers' accounts.

COMPANY NEWS

• GameStop has launched a takeover bid for the much larger eBay, having built a 5% stake and secured a US$20B debt financing letter. LINK

• Qantas warned that the Iran war has cut about 20% of international capacity into Australia. LINK

• Qantas launched a week-long double status credits promotion on flights within Australia and to New Zealand to bolster demand amid weak consumer sentiment and higher costs. LINK

• Westpac reported a 3% rise in first-half profit to $3.4B as total lending and deposits grew 7% and business lending to large institutions jumped 23% to $131B. LINK

• Databricks is investing $416M to expand in Australia as it opens a new 2000 square metre Sydney HQ, lifts headcount to 400 and plans to train 100,000 people. LINK

• Wesfarmers chief executive Rob Scott says more affluent customers are increasingly buying Kmart’s Anko brand, which has sold over 1B items annually in Australia since 2019. LINK

• Wesfarmers has partnered with contractor Built in a $250M Built Living venture to manufacture modular apartment components, aiming to halve high‑rise build times and cut costs by about 20%. LINK

• Nine Entertainment reported a strong Q3 with 8% TV audience growth and 15% publishing digital subscription growth, while warning of softer Q4 advertising and uncertain Google arrangements. LINK

• News Corp is buying a 20% stake in logistics company National Distribution Services to create Reach Plus, which will use spare newspaper truck capacity to streamline regional deliveries across Australia. LINK

• ANZ lost a NZ class action after Justice Venning ruled a representative customer is owed NZ$32,728.42, with about 17,000 customers affected and ANZ estimating liability at NZ$125M. LINK

• Mars Inc is investing $200M to upgrade its Australian factories, including $113M at its Wodonga pet food plant with AI and robots, as supply chain inflation heads toward 10%. LINK

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ONE MORE SCROLL

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TRIVIA

1. What is the highest-pitched instrument in the orchestra? Flute or Piccolo?

2. What is the highest number on a standard Roulette wheel?

3. In The Simpsons what was the name of the Barbie-like doll?

4. Which bird turns its head upside down to eat? Flamingo or Owl?

5. Which US coin is physically smallest? Nickel (5 cents) or Dime (10 cents)?

Answers below

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ANSWERS

1. Piccolo
2. 36
3. Malibu Stacy
4. Flamingo
5. Dime (10 cents)

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