Good morning! Let’s start the week…
1. Back to Iraq. Australia’s decision to send 600 military personnel to the Middle East – 400 from the RAAF and 200 from the Army including a number of special forces troops – has the country on the verge of engaging in combat against the Islamic State. So far, the Australian mission is for airstrikes and logistical support for other forces in the region who will do the fighting. But as the world digested another beheading by ISIS – this time of a British aid worker – the debate in America is starting to focus on whether air strikes will be enough.
2. Police in Sydney, meanwhile, are searching for rocket launchers – five of them, in fact – believed to have been hidden in bushland somewhere around the city by members of a terror cell with links to ISIS fighters Mohammed Elomar and Khaled Sharrouf, according to a report in The Daily Telegraph.
3. Weak data out of China released over the weekend will be exercising minds in markets in Australia and across Asia today. China’s industrial production, fixed asset investment and retail data all came in lower than expected. Westpac’s Jonathan Cavenagh writes in a note to clients this morning that “we could continue to see softer data momentum for a number of weeks before we reach a point where can say more confidently that a lot of ‘bad news’ is now priced into the short term China outlook”. Small adjustments in China can have larger impacts back in Australia, so this is a space to watch in the coming weeks.
4. This will have the Aussie dollar under pressure, and it’s looking likely to head for the US90c mark this week, even this morning. A lower dollar is something the Reserve Bank has been eyeing for some time, and there’ll be some exporters who will be excited at the prospect too.
5. The countdown is on to Scotland’s independence vote. The latest polls say the result is too close to call. Deutsche Bank is the latest to offer a grim assessment of the likely economic consequences for Scotland if voters decide to split with the UK, saying a Yes vote would be one of the “greatest blunders ever”, leading to years of misery. It’s not the only independence movement in Europe at the moment: the Catalans will vote on November 9 on whether they want to leave Spain, in a referendum which the Spanish government doesn’t recognise. It’s potentially a much bigger problem for European unity than the Scottish question. Details here.
6. Global brewer wars. SABMiller, the world’s second-largest brewer which makes Peroni and Grolsch, has made a takeover approach to Heineken which has been rebuffed. A combined company would be worth around $US134 billion, and combine the world’s second and third largest beer companies.
7. Here’s comes the taper. Well, more taper, when the FOMC meets in the US on Tuesday and Wednesday before releasing a statement Wednesday at 2pm ET (Thursday, 4am, AEST). We know the FOMC will reduce asset purchases (aka QE3) by $US10 billion to $US15 billion. What we don’t know is whether the US will see its first rate hike before mid-year 2015. Here’s your complete preview.
8. A hot weekend on the Australian property market. More than 1000 houses were sold in Sydney and Melbourne alone, with the average price in the NSW capital $1.175 million – it was just $975,000 a year ago, according to The Australian. Meanwhile, at the AFR, there’s an agent surprised at the record price secured for a home in Artarmon on Sydney’s north shore: the $2.95 million at auction was $350,000 above the reserve, and broke the $2.82 million record for the suburb. “We were never expecting above that,” said LJ Hooker agent Sam Green. “It was half the land size, a similar home, and the other had a tennis court. Competition forces good prices.” When the selling agents are shocked at the prices…
9. Even Channel Nine says Melbourne is better than Sydney. The makers of The Block say Sydney real estate is simply too expensive, they say, costing the city the chance to stage the show for the past three years and now the next two years to come. The Block has just snapped up properties in the Melbourne suburbs of South Yarra and Albert Park. The Block executive producer Julian Crest said there was also a nimby (“not in my backyard”) culture in Sydney that didn’t help. “Last time we were there, the neighbours organised protests and lodged objections with the council the moment they heard we were coming,” he told News Corp. “We don’t find that sort of anger in Melbourne. We get a warm welcome from the get-go.”
10. What the iPhone 6 will cost. The pricing structures for the iPhone 6 and iPhone 6 plus, available from September 19th, leaked last Friday night. The basic models on the cheapest plans will cost just short of around $80 with Telstra and Virgin, and Optus will have a plan that will let you get one for $60. Details here.
Bonus item: Willie Mason of the Newcastle Knights wore a microphone during last week’s game against the Dragons. It captures some great sledging, including Willie asking Dragons players ahead of a scrum where their front-rowers are. Good fun. Of course, there’s some language.
Enjoy your Monday. I’m on Twitter: @colgo
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