Petrol pain; More unemployed 

Weekly petrol prices; Census; Chinese property

• Petrol: According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol rose by 1.5 cents to 127.4 cents a litre. Prices rose in six capital cities.
• Census: Latest update from the Australian Bureau of Statistics compares employment data from the 2006, 2011 and 2016 Census. This provides some explanation for soft wage growth more recently.
• China property: Chinese house prices rose 6.3 per cent in the year to September, down from 8.3 per cent in August. This was the slowest pace in 17 months. Prices rose in all but three of the 70 cities.

What does it all mean?

• Filling-up the car with petrol is the single biggest purchase for most Aussie households. With family activities taking priority over the weekend a large portion of us wait for the school run or work commute to visit the bowser on Monday. Motorists in Sydney and Melbourne would’ve been flabbergasted to awake to significant petrol price hikes this morning.
• The average retail price of unleaded petrol (as measured by MotorMouth) unexpectedly rose by around 20 cents per litre in both of Australia’s largest metropolitan cities. Unravelling the mystery of the petrol price cycle is something that consumers, including ourselves, continue to grapple with.
• The latest release of Census data provides some explanation for soft wage growth – there are more unemployed people than previously thought. In August 2016 the monthly job report indicated that unemployment (in original terms) was 5.6 per cent. But the Census data suggests the “true” rate was 6.9 per cent. Using the same criteria for previous Census’ suggest similar under-reporting of unemployment but not to the same extent. In 2006 the monthly job report put unemployment at 4.5 per cent (Census 5.2 per cent). And in 2011 the monthly job report indicated a jobless rate on Census night of 5.1 per cent whereas the Census data suggested it was 5.6 per cent.
• The Chinese economy continues to grow strongly at almost 7 per cent per annum. This is supportive of Aussie exporters of commodities and services-related goods and products. While the deceleration in house prices in some of China’s largest cities may appear concerning to some, Chinese policymakers currently meeting in Beijing will feel differently. They have spent much of the year limiting loans to home buyers and imposing measures to restrict speculative property purchases in an attempt to cool China’s overheated property market.

What do the figures show?

Petrol prices

• According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol rose by 1.5 cents to 127.4 cents a litre in the past week. The metropolitan petrol price increased by 2.0 cents to 127.4 cents per litre while the regional price rose by 0.5 cents to 127.5 cents per litre.
• Average unleaded petrol prices across states and territories over the past week were: Sydney (up by 0.7 cents to 126.3 c/l), Melbourne (up by 0.9 cents to 124.8 c/l), Brisbane (down by 3.3 cents to 123.7 c/l), Adelaide (up by 23.2 cents to 141.0 c/l), Perth (up by 0.5 cents to 129.7 c/l), Darwin (up by 2.2 cents to 130.1 c/l), Canberra (up by 2.5 cents to 130.7 c/l) and Hobart (down by 0.1 cents to 135.1 c/l).
• Today, the national average wholesale (terminal gate) unleaded petrol price stands at 117.3 cents a litre, up 0.7 cents over the week.
• The wholesale unleaded petrol price hit 5-month highs of 117.4 cents a litre on October 4 and has since fallen by 1 cent a litre to 117.3 cents a litre on October 23.
• The terminal gate diesel price stands at 117.2 cents a litre, up 0.3 cents over the past week.
• Last week the key Singapore gasoline price fell by US15 cents or 0.2 per cent to US$69.60 a barrel. In Australian dollar terms the Singapore gasoline price fell by 32 cents or 0.4 per cent to $88.71 a barrel or 55.79 cents a litre. It was a bigger decrease in local currency terms due to a stronger Aussie dollar.
• MotorMouth records the following average retail prices for capital cities today: Sydney 139.3c; Melbourne 140.8c; Brisbane 135.8c; Adelaide 139.8c; Perth 118.8c; Canberra 137.3c; Darwin 131.6c; Hobart 124.6c.

China property

• Chinese house prices rose 6.3 per cent in the year to September, down from 8.3 per cent in August. This was the slowest pace in 17 months, marking the tenth straight month of price deceleration after annual price growth peaked at 12.6 per cent in November 2016.
• In annual terms, prices rose in all but three of the 70 cities surveyed by the National Bureau of Statistics in September. Exceptions included Shanghai (down 0.1 per cent), Shenzen (down 3.8 per cent), and Chengdu (down 2.8 per cent). Price growth slowed in the capital Beijing to just 0.5 per cent over the year in September.

What is the importance of the economic data?

• Weekly figures on petrol prices are compiled by ORIMA Research on behalf of the Australian Institute of Petroleum (AIP). National average retail prices are calculated as the weighted average of each State/Territory’s metropolitan and non-metropolitan retail petrol prices, with the weights based on the number of registered petrol vehicles in each of these regions. AIP data for retail petrol prices is based on available market data supplied by MotorMouth.
• China’s National Bureau of Statistics releases its monthly economic statistics around mid-month. Quarterly GDP data is released around the 19th of January, April, July and October. China’s Customs Office releases trade data, and the People’s Bank of China releases financial statistics, around the 10th of each month. China is Australia’s largest trading partner and changes in the Chinese economic have major implications for the Aussie economy.

What are the implications for interest rates and investors?

• Petrol is the single biggest purchase that most families make each week. At present the price of petrol isn’t weighing on budgets. But for that matter, if petrol prices were lower, they would provide a nice foil to higher power prices.
• In the September quarter, petrol prices fell by 2.4 per cent, after a 2.5 per cent decline in the June quarter. We expect falling prices to subtract around 0.1 percentage points from the headline consumer prices index in Wednesday’s data from the Australian Bureau of Statistics.