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ASX to drop; and is Australia's recession already over?

Jessica Yun
·3-min read
SYDNEY, Aug. 14, 2020 -- Photo taken on June 9, 2020 shows a street in Sydney, Australia.
Victoria was thought to delay Australia's recovery for months – but is the recession already over? (Xinhua/Bai Xuefei via Getty Images)

Good morning.

Here’s Yahoo Finance’s Wednesday morning wrap:

ASX: The Australian stock market is set to open lower after Wall Street yielded mixed results overnight and the Dow saw its biggest drop in nearly two months.

More on what went down on Wall Street overnight from Yahoo Finance US reporter Emily McCormick here.

Australia’s in the worst recession it’s seen in decades. Right? Well, the Reserve Bank’s deputy governor Guy Debelle told a Senate estimates hearing that we’ll likely see growth in the September quarter, and Victoria’s drag on the economy actually wasn’t as bad as we thought.

“At the moment it looks like the September quarter for the country probably recorded positive growth rather than slightly negative,” Debelle said.

“The growth elsewhere in the country was more than the drag from Victoria and the drag from Victoria was possibly a little less than what we guessed back in August.” Wow.

But it certainly still feels like a recession – hundreds of thousands of Aussies are still out of a job. What’s the difference between a recession and a depression? Contributing editor Samantha Menzies breaks it down.

What else is the RBA up to?

RBA assistant governor Michele Bullock gave a speech online yesterday, and flagged further business failures even amid the economic recovery.

“Business failures are currently much lower than usual because of income support, loan repayment deferrals and temporary insolvency relief," she said.

“But this can't last and we expect to see failures rise.

“Survey evidence suggests that around a quarter of small businesses that are currently receiving income support would close if support were removed now and trading conditions had not improved.”

It’s also looking increasingly likely the RBA will cut the interest rate to 0.1 per cent. What would that world look like – how would life change?

Yahoo Finance reporter Anastasia Santoreneos spoke to AMP Capital chief economist Shane Oliver to find out what would happen to your home loan rates, savings rates, the stock market, consumer spending and the Aussie dollar.

What else should I know this Wednesday?

We’ve all worked for a boss that annoyed the life out of us. But what if was the other way around? Workplace expert and author Michelle Gibbings shared seven habits that annoy your boss – and what to do instead.

Turns out Aussies don’t want a gas-led recovery, which was touted in the Morrison Government’s Federal Budget. Rather, two in three Aussies would prefer renewables be the pathway out of recession, according to a survey by the Australia Institute.

Labor wants the ASIC expenses scandal wrapped up within two weeks. Shadow Assistant Treasurer Stephen Jones called the scandal extraordinary.

“There is no disagreement over the facts here. It seems pretty clear what's gone on - payments were made, they were unauthorised and unlawful,” he told AAP.

“The only question to my mind is who knew? Did the prime minister know? Did the treasurer know?”

“It's a devastating blow to ASIC," said. “At a time when we need the corporate cop to be on the top of its game, it's actually on the bottom of the ladder.”

ICYMI

Amy Coney Barrett has officially been sworn in as a new justice to the US Supreme Court. Here’s our breakdown of who she is, what her views are and how she could change the face of America forever.

–with AAP

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