Lead partner of Deloitte Digital, Frank Farrall - RMIT economist Sinclair Davidson - Talking Business 2012 - Ep19

Summary: Interview with Frank Farrall, lead partner of Deloitte Digital Interview with RMIT economist Sinclair Davidson Leon and Garry discuss issues including: Top European finance ministers vowing to respond "speedily" to the continent's debt crisis as Spain pleaded for help for its struggling banking system so as to avoid a full and humbling bailout. Billionaire investor George Soros meanwhile says Europe has three months to save the Eurozone. Meanwhile concerns are growing that any recovery in the US has sputtered out. The United States economy added only 69,000 jobs in May - only about half of what is needed to keep up with natural population growth. Meanwhile, surveys of Chinese factories in May added to a gloomy picture for economic growth in the world’s second largest economy, suggesting the slowdown is broader than previously thought, hitting both domestic and overseas demand. So where does that leave Australia? Business people around the world are now bracing themselves for tougher times in the wake of the triple-headed downturn – in Europe, China and the US. But Treasurer Wayne Swan says Australia's economy is well-placed to deal with global financial trouble. Australia's current account deficit grew more than expected in the March quarter, according to data from the Australian Bureau of Statistics. This was mostly driven by a large rise in mining equipment imports. The data showed Australia posted a seasonally adjusted current account deficit of $14.892 billion for the three months to March. The figure is 55 per cent bigger than last quarter's figure But the Australian economy expanded more than expected in the March quarter, according to figures from the Australia Bureau of Statistics. The data showed gross domestic product (GDP) in the quarter to the end of March rose a seasonally adjusted 1.3 per cent. For the 12 months to March, GDP rose a seasonally adjusted 4.3 per cent. The Reserve Bank of Australia (RBA) has cut the official cash rate by 25 basis points to 3.50 per cent, citing further weakening in Europe and some moderation in growth in China as contributing to its decision. But Australian house prices have slid to a six-year low in capital cities despite RBA efforts to lift the housing market out of the doldrums with rate cuts. Home values dropped 1.4 per cent across all capital cities in May and are now down by more than 5 per cent on a year ago, according to RP Data figures. The TD Securities-Melbourne Institute Monthly Inflation Gauge was flat in May compared with April, keeping the annual rate of inflation at 1.8 per cent. The latest Dun and Bradstreet business expectations survey shows that Australian enterprises expect lower profits in the September quarter. Company gross profits fell further than expected in the March quarter. Gross profits for the three months to March dropped four per cent, in seasonally adjusted terms. The ANZ job advertisements survey showed the number of total advertisements on the internet and in major metro newspapers fell 2.4 per cent in May.