If you are wondering about what would appear to be almost optimism as a result in the aftermath
of the inflation data released yesterday, you’re not alone.
Many economists are going, well, yes, inflation has slowed reasonably.
That’s good news.
The Federal Treasury, Jim Chalmers, is right.
That’s good news.
Although many are questioning whether it’s under control.
The Reserve Bank will deliver its next interest rate decision on Tuesday, February 18.
And financial markets are apparently pricing in a more than 90% chance of a rate cut.
Now, if you hold a mortgage, that’s probably good news for you.
Let’s see what the RBA does next month.
However, if you’re living and you have to eat, pay insurance, pay rent, the situation
is actually not easing.
The data doesn’t reveal the real story.
As to why, let’s go to Peta Tilse.
Peta Tilse is a mother of three hungry boys and an economist.
And I spoke to her this morning about how she sees the latest inflation data.
So as we’ve all heard, the trimmed mean is 3.2%, which is great because it’s almost in
the 2% to 3% band that the Reserve Bank looks at.
And remember, the trimmed mean just shaves off the very volatile items on the side.
So we’re just looking at the sort of key stuff in the middle.
Having said all of that, when we look at what within the data were the biggest movers, and
I actually looked at it from the perspective of over the last 12 months, electricity prices
are down almost 10% over the last 12 months, which you would expect given all of those
rebates, right?
But without the rebates.
They are artificially brought down by the federal and the state rebates.
Correct.
And they’re not lasting.
So that was just that period of time.
So without those rebates, that number would have actually been positive 0.2% so up.
And then in terms of fuel, which was the other good one, that was down 2%.
That sure, that is what it is.
And that’s a good thing.
But that’s probably a bit of Trump blustering as well in terms of trying to get the fuel
price a bit lower to start Russia of money.
So that’s a whole other story.
And then if we have a look at other things, well, we all need insurance for our houses
and so forth.
Well, that’s up 5% over the year.
Fruit and vegetable prices up 7% over the year.
Rent up 6% over the year.
So it’s, you know, what’s actually happened is something you might have paid $100 for
a year ago is now $107 if it’s fruit and veg, for instance.
So that’s what’s happened.
Okay.
Now, I just thought it was interesting.
So I was curious before all of this, what prices of some everyday items that we might
have in our shelves at home.
I need to say at this point, Peta, it tells us that one of the reasons why I like speaking
with you is not only are you an economist, but you’re also the mother of three boys.
So you like myself and my listeners, you go to the supermarket and you shop yourself to
feed your family.
And that’s the reality check right there.
Absolutely.
So let’s, let’s, let, I did a bit of digging.
I found an old press release from Coles, one of the major supermarkets, and they were talking
about their prices are down campaign, which we’ll remember.
So they listed a bunch of everyday items that they were very proudly showing that they’re
going to keep at a low price.
This is back in September, 2020.
So the biggest mover I found was Moro Olive Oil.
It was $12 then.
Today it is $27 and on sale it is $19.
So the exact same like no shrink flation, that’s the price.
And so the percentage difference is 125%.
On sale it’s 58%.
So it’s nowhere near this trimmed mean of 3% right.
And then fab laundry powder, same kind of thing, $7 then $9 now.
So that’s 29% difference.
So an Nescafe, if you drink coffee, $10.75 to $14.50 now.
So that’s 35%.
So this is, this is the issue.
We used to pay nearly 35% less for certain items and we’re not.
And they’re going up incrementally and that’s what’s hitting the household budget.
What does this reveal, Peta?
Because at the moment, the sort of the economic commentary is that this is wonderful news
as a result of the inflation rate release yesterday.
It means that, you know, there’s a chance, there’s a chance of a rate cut in February
for mortgage owners.
But it’s sort of not really addressing what people are actually losing out of their
wallet on a weekly basis when they get food.
So what’s going on here?
Well, I think at the end of the day, look, we know that the politicians do what they
can and it is about with their iron the main prize, which is getting reelected.
And we did get those electricity rebates, which has helped bring down this particular
number that the Reserve Bank looks at.
But it’s temporary.
That’s correct.
And the everyday costs are still there.
Like we still will need insurance, fruit and veg, rent, the, you know, the big items
that have, like they’re slowing, like they’re slowing in terms of the price rises.
But, you know, it’s still elevated.
And it’s, like I said, those numbers keep growing off a higher base.
So it’s productivity.
It’s having cheaper access to energy to produce things.
It’s, it’s all of those things.
Jim Chalmers, the Australian Treasurer, says he’s confident that inflation is under control.
Do you agree?
I think, well, look, I think it’s better.
But I wouldn’t say it’s totally under control.
I think there’s a few, like I said, a bit of smoke and mirrors at play.
But if that’s what you have to do to get it down, sure.
But don’t forget, we don’t have a lot of slack in our economy.
And I mean, in terms of the employment situation, we’ve got an unemployment rate of 4%.
That is considered full employment.
Yeah.
So if we do cut rates, that’s going to be stimulatory.
That’s going to be positive for the economy.
That’s going to speed things up a little, which might mean you go to the shops a bit more or go out to dinner or whatever.
And that means that that business might hire another person.
But they’re trying to hire another person, which means prices of wages might go up.
You know, so it’s, it’s, it’s a, it’s a balancing act.
It’s, it’s, yeah, it’s difficult.
And there’s still a large amount of federal money going into the economy, particularly in the sort of the government sector with NDIS jobs and the like.
I think nearly half, well, nearly 500,000 people associated with the NDIS alone at the moment, all federal money, that that’s very stimulatory.
And perhaps some are arguing it’s distorting the economy.
That’s right.
And a lot of that, we saw that in the GDP numbers, the growth numbers.
Oh gosh, back in last month, how I think the, the rate was 0.8% was the annual growth rate, which is very slow, which is possibly a good thing.
But you would expect that unemployment would, would loosen up, so to speak, and move from that 4% rate to a bit higher, but it hasn’t.
So that’s where exactly what you said, like the government spending has actually sort of gobbled up some of these people and taken them out of what could have been other jobs or reduced a bit of slack in the economy.
I’ll let you go and plan for your shopping for the weekend as you feel the pain of, of the real
inflation. Peta Tilse, thanks very much for your time.
Pleasure, Steve.
Peta Tilse, she’s an economist as well as a mother of three hungry boys.

Well, one of the region’s busiest shopping centres has a new owner with a large property
fund manager, buying the Centennial Plaza in Cooma.
The precinct on Sharp Street, it’s home to 15 tenants, including a major supermarket,
banks, real estate agents and more.
Steven Goakes is managing director of the new owner, Natgen.
Steven, good morning.
Good morning, Eddie.
Nice to be with you.
What’s the motivation for you to invest in a town like Cooma?
Well, we look nationwide for towns like Cooma to invest in, basically, because we invest
in regional convenient shopping centres, which are supermarket-based.
That focus on regional gives us a strength in our market, because towns like Cooma are
actually very good places to invest because they have long-term prospects.
They’ve got history, and it’s just steady, nice places for us and our investors who
come from all across the country to invest.
We have similar investments in Queensland, New South Wales and Western Australia, which
are the most regionally-based states as well.
In this challenging cost of living climate that the country has been facing in recent
months and years, how are those regional convenience shopping centres faring?
Well, there’s been, over the last decade or so, including through this time, a dichotomy
of how shoppers behave.
So there’s a lot more people shopping online, again, for looking for the bargain, chasing
the bargain.
And people are shopping more locally because they’ve realised that local costs are no more
than going to larger regional shopping centres.
And really, the major supermarkets, although they come in for a lot of flack about this,
have actually been pretty good about ensuring that their pricing is relatively consistent
over their networks.
Not totally consistent, but relatively so.
It’s interesting because you’ve got some retailers leaving regional areas, the clothing
chain Rockmans, for example.
Is it the supermarket in a shopping centre like this that really anchors the centre?
Yes, well, we don’t call them our anchor tenant for nothing.
That’s very true.
But one of our challenges and opportunities at Centennial Plaza in Cooma is to invigorate
the tenancy mix so that it’s a better experience for shoppers.
At the end of the day, what we’re looking for is more people to shop in the centre.
That’s good for our customers.
Our customers are the tenants.
They’re the people that pay our rent.
And if they can get more customers and we can assist them with that, that’s best for
everyone involved, including the shopper.
So when you say invigorate the tenancy mix, what might that look like?
What are the sorts of businesses you’d like to see in the plaza?
Well, the point about convenience, which is what we focus on, is ensuring that people
can get in, do as much as they can close by and get back out.
So the type of tenants we’d be looking for are those that people use very regularly.
That varies from place to place, but obviously groceries, people use banks, people use post
offices and those sort of services.
So the more of those that we can attract into one area we feel is best for the town to be
able to service everything in one location rather than taking more time and possibly
creating more traffic, etc., by going to various places.
It’s quarter past seven on ABC Southeast.
You’re hearing from Steven Goakes, the managing director of Natgen, which has just recently
purchased the Centennial Plaza in Cooma.
What’s the relationship like that you as owners have with the tenants in a centre like this?
How does that work?
In fact, we settle the purchase in a couple of months time, but we’ve been through a long
sort of due diligence period and getting to know the centre.
It takes time to establish relationships with tenants.
They tend to expect you to be like the previous owners, and I’m not sure what they’ve been
like in terms of relationships, but it takes fact finding, it takes a lot of listening,
it takes considering what we’re going to do together to promote the centre and what’s
important to them.
And typically those things are making sure that the parking works well and the pedestrian
access is good, obviously, allowing again people to get in and out as quickly as possible.
Lighting is another important issue.
Lighting goes to that general sort of feeling of safety and inclusion in the place you’re
in.
So, we go through those processes with tenants over time.
Many have different views on those sorts of things, so we take those into account and
come up with a decision on our strategy forwards, but that takes some months, as I say, to go
through that process.
Are there long-term investments when you invest in these regional shopping centres?
Does it mean you’re here for the long haul?
Yeah, well, our general term of our trusts for our investors is a five to six year term,
but that’s able to be increased if a centre is performing well and we’re doing our job
well.
So, we see ourselves as taking a long-term view.
If that ends in five or six years, so be it, but it’s a longer term view we take because
we want to make sure as well, of course, Eddie, that when we get to the end of that time,
we’ve got the best saleable asset in the best condition available for whoever the next owner
might be.
Steven, really interesting to get an insight from you this morning.
Thanks very much for your time.
Thanks.
Have a great day.
Thank you, Steven Goakes, the Managing Director of Natgen.
They’re a large property fund manager and they are purchasing the Centennial Plaza in Cooma
on Sharp Street where you’ve got the big supermarket and some 14 other tenants.
They’re a firm that invests in these regional convenience shopping centres.
He talked about the need to invigorate the tenants he mixed there at Cooma.
And you know, you think when you go to the shops, obviously the individual store is responsible
for everything you do when you’re in there doing your shopping, but when it comes to
that overall experience of where you park, what the lighting is like, how you’re getting
between the shops, it is that overarching owner that has a role to play.
Let’s get a local business perspective.
Lynette Armour is the President of the Cooma Chamber of Commerce.
Morning, Lynette.
Morning.
How does a big shopping centre like this sort of fit into the overall local business scene
in a town like Cooma?
It’s definitely one of the biggest, well, probably the only plaza that we actually have
in town.
So definitely plays a really big role in what we can offer to the locals.
So yeah, it’s really good.
What Steven Goakes was describing was, you know, they want to invigorate the tendency
mix there.
They want to look at if there’s things they can do to improve things like parking and
lighting.
Are there things that local business or that the local community might like to see different
in the area in the future?
No, I think it’s got really good parking down there.
So it does offer, especially the weather that we have out in this area, some under cover
parking, which is really good for not only the people that come to shop there, but also
other businesses that might need to park underneath during the day.
So that’s really helpful.
It does offer that, yeah, protection, which is really good.
They’ve had a few issues with the birds in the past.
So it’d be interesting to see what they can do to rectify that situation.
But yeah, no, it’s looking positive.
What would the businesses, the tenants be looking for from a new owner?
What might they hope to see from that kind of relationship?
I think the biggest thing is just that support and consistency.
The plaza has been sold numerous times over the last four years that I’ve been here in
town.
So I think that’ll just be really good that these guys are coming in with a five-year plan
and will just give that stability.
Are you seeing this sort of investment in the town?
I know one of the factors that the company mentioned was Snowy 2.0 and the impact that’s
having on the local economy.
Are you seeing a lot of investment in town?
I think it’s starting to build.
Definitely with Snowy Common Board, it’s been a really big help.
But yeah, no, it’s definitely starting to build.
You can see the momentum there.
Start of the year, you’ve got the push for more tourism in the Snowy Mountains all year
around, including in summer.
You’d also have businesses gearing up for the winter season.
How are things going at the start of 2025?
Yeah, I think there’s had a lot of traffic through town.
Let’s hope they’re staying and looking around and doing a bit of shopping.
But there’s definitely a lot of flow through of traffic at this time.
So a lot of people heading down the coast, a lot of people heading back up from the
coast.
So yeah, it’s definitely one of the busiest times on a busy snow season.
But we do have a lot of people that go down to Jimmy for the bikes as well.
So definitely a lot of traffic coming through town.
Is it a matter of trying to come up with new ways, encourage that traffic to stop and
buy lunch and spend a bit of time in town?
Yeah, definitely.
Even on the Chamber, we’re trying to do things that just, you know, makes Cooma look more
inviting to stop and stay.
So yeah, definitely that’s our big thing.
We really want people to say, hey, look what’s here.
Let’s stop, visit the local shops, spend a little bit of money and just see how beautiful
Cooma is.
Lynette, good to chat this morning.
Thanks very much.
Thank you.
Lynette Armour, the president of the Cooma Chamber of Commerce.

ABC Brisbane. Well, as you know, that heard yesterday, the Reserve Bank used its final
meeting of the year to keep interest rates on hold. The official cash rate remains unchanged
at 4.35%. That means if you’ve got a hefty mortgage that you’re struggling with, no
immediate relief. Think February, May next year sometime, maybe. It’s been 13 months
now since there was no change at all in the settings of the Reserve Bank. So what does
this mean for you and me? Well, Peta Tilse is head of funds management at Natgen. Peta,
given what the RBA didn’t do yesterday, what does that mean for you and me?
Steve, just pointing out first up that what we got out of the RBA is dovish comments,
both in the minutes and the press meeting. And what that means is they’re being a bit
softer, I guess, in terms of how they feel about inflation. So being like a peaceful
little dove. That means also that they’re contemplating interest rate cuts. Now, coming
out of that meeting, market pricing is now showing a 70% probability of a February rate
cut and two rate cuts priced in by the May meeting. ANZ and NAB, I think, are both on
the page that it’s going to happen in May, but it doesn’t mean that people in the money
markets think otherwise. So that’s what’s happening. And now we’re talking about terminal
interest rates finishing up at around about 3.35%. So that’s a whole percent different
to where we are today at 4.35%. So if someone’s got a hefty mortgage sometime
between February and May next year, they can expect a little bit of relief, maybe.
Correct. All right. What is the cost of living at the moment? Inflation. We had GDP data
out the other day and cash rate today where the RBA is looking at inflation. So what does
that mean for what you and I are paying when we buy for a coffee or groceries or something?
So just to recap, inflation last week was 0.8%. That’s actually pretty anemic. While
it’s positive, it’s anemic. It’s the weakest number that we’ve had since the 90s. So excluding
COVID, that is, of course. Business investments are subdued and household spending has dropped
and they’ve increased savings. And what that means is people are banking any of those tax
cuts that they’ve got since July 1. And they’re banking any sort of savings they can when
it comes to energy prices. In terms of good bringing up coffee, first thing in the morning,
Steve, I was actually pondering this the other day as I paid $5 from my coffee, which I really
appreciate from Grace and Dwayne below our building. If you think about what goes into
producing coffee, you need energy, you need wages, and there’s obviously coffee beans
and milk and so forth. Energy prices for businesses sky-high, as we know. They did get a bit of
a rebate, but it’s not a long-term fix. Wages are higher than they were a couple of years ago.
So if I think about my $5 coffee a year ago was $4 and probably two years ago was about $3.50.
So that’s increased 42% from about two or three years ago.
Peta Tilse is head of funds management at Natgen.

Well, the pundits don’t like him.
The journalists apparently are terrified by him.
The commentators, depending on where you stand,
think he’s controversial or dangerous.
Donald Trump’s win sent stock market sky high.
The market loves him.
Will this trend continue,
or is it a case of what goes up must come down?
Let’s speak with Peta Tilse.
Peta Tilse is head of funds management at NatGen.
I spoke to Peta earlier this morning
and asked what the market reaction was
to the election of Mr. Trump.
Definitely, Steve.
It’s been a big sort of 24, 48 hours
since the election result, and Wall Street liked it.
So we saw stocks rally.
We saw the S&P 500 up about 2.4%
of sort of the day after the election,
and small caps specifically up 5.6%.
So that’s pretty big moves.
And then you’ve got things like Tesla
with Elon Musk being his number one fan, I guess.
So even just overnight, Tesla was up 3.6%,
but the last sort of five days, it’s up about 18.7%.
So huge moves.
I heard somewhere, forgive me,
I can’t quote the actual source,
but it was the biggest sort of post-election lift
in just so many years.
Apparently it was such a hugely positive response,
which is intriguing to me, Peta.
Tell me about Warren Buffett.
I hear that he sold a whole lot of stock
and may have been bruised.
I assume he was expecting a Trump loss.
So tell me the story.
Yeah, well, Warren Buffett, as we know,
considered one of the world’s best investors,
Berkshire Hathaway,
a huge global investor in a lot of brands that we know.
So Warren Buffett’s company has been a massive cash pile.
So they’ve been selling down Apple shares
and all sorts of things.
And they’ve amassed $325 billion worth of cash.
So he’s sitting on that.
Meanwhile, Tesla’s rallied 18% in the last five days.
So I don’t think he would have ever invest in Tesla,
but yeah, so it’s been a tricky market.
I’m sure Warren’s looking at a longer game here,
but yeah, there’s definitely some big moves.
And the US Federal Reserve has reportedly
or apparently made some sort of cut or adjustment
to their rates, to their cash rate.
What have they done?
Yeah, so this morning,
not the RBI, the Federal Reserve, I should say,
just came out and cut by 25 basis points.
It was kind of expected,
but I’m pretty sure Mr. Trump will try and claim that
as a victory on him.
And essentially, look,
they’ve sort of been winning the war on inflation
for the time being,
and their unemployment rate is similar to ours
at around about that sort of 4.1% level.
So the US economy is reasonably healthy,
and they can do these moves,
but it’ll be very interesting to see how that changes
over the course of the next sort of 12 months
once Trump gets inaugurated
in, I think it’s in January,
because a lot of his policies are very pro-America.
You think of in terms of him wanting to build walls
and do those kinds of things,
but there’s also gonna be lots of tax cuts,
corporate tax cuts,
which is part of the reason why Wall Street went bonkers,
and there’s also gonna be tariffs,
which is also supported for US-based businesses.
I mean, some of the tariffs that he’s been mooting
are like 60 to 200% on Chinese goods,
25% on Mexican goods,
and 10% on the rest of the world.
So if you’re an American company,
rely on cheap Chinese steel,
and it’s now gonna be 200% more expensive,
that’s gonna feed into inflation to the US consumers.
So it’s gonna be a very interesting period of time
that we’ll be going into.
Some other points tonight too is Europe
is probably just sitting and watching all of this
because they export a lot to the US,
and they’ve got their own sort of economic concerns
with a very slowing economy there.
So if they can’t export what they need to export,
then it’s gonna sort of mess up
their sort of economic picture even more in Europe.
So I think, yeah, we’re all in for a bit of a new paradigm.
And Fed has cut rates,
but will they continue as probably the next question?
I always think it’s fascinating
when this bloke gets elected,
it always upsets the establishment,
Apple cart, which is what I suspect
many of his supporters actually like anyhow.
So it’ll be fascinating to see how it plays out.
Peta Tilse, thank you very much for your time.
Once again, Peta.
Pleasure, Steve.

The latest inflation figures are out and the inflation rate is down. Or is it? It turns out the
lower inflation rate is actually due to what some would call gaming the system or gaming the way we
measure it. The big number everyone’s talking about, that 2.8%, isn’t the figure that the reserve
bankers looking at. They’re looking at what’s called the trimmed mean. Now I know that doesn’t get
you excited. So let me explain. Peta Tilse is Head of Funds Management at NatGen. Peta, what was
the inflation figure, first of all, that was released yesterday? So there were two numbers that
get released. There’s the headline number, so 2.8% for the September quarter, which is a fabulous
number because it’s literally within that 2 to 3% band the reserve bank looks at. Having said that,
there’s a thing called the trimmed mean and that is sTilse at 3.5%. And it was down from the last
quarter, which was 4%. So it is down, but it’s sTilse 3.5%. Now I’m fascinated by this. Let me
explain why. So the figure that everyone’s going, hooray 2.8. But as I understand it, that was
artificially brought down because of all of that stimulus or that what was called the cost of living
spending by the Commonwealth and the Queensland State Government. Explain that to me, Peta.
Spot on. Okay. So basically inflation measures the rate of change of a price of something. Yep.
And it takes a whole basket of goods that you and I spend our money on all day every day.
And one of those things is energy prices. So electricity to the house or whatever your business.
Anyway, so that particular item has actually dropped 17% in the September quarter.
How? How has that magic occurred? I wonder, Steve. Could it be a $1,000 rebate that we all
received? Could it be the federal government’s sort of stimulus payment? So those kinds of numbers,
well, sort of fudged, I guess, if you want to call it something. Yes. But, you know,
so that’s just just one element. And that feeds into the goods inflation numbers. So that helps
goods inflation look cheaper, like half. It’s literally half the year. Yes. So that’s that’s
electricity. That includes transport. So petrol prices are actually a bit cheaper. But something,
some other things that are a bit sticky, so to speak, egg prices are up 9%.
Yes. So fruit and veg and all that sort of stuff is actually sTilse higher. It’s up about 3%. And the
other thing that’s sticky too is services inflation. So the stuff that we we also keep paying for all
day every day is rent, insurances, education, medical stuff. That’s all up. And that’s actually up
four and a half percent over the last 12 months. So you just can’t escape it. It’s there. Yeah,
inflation isn’t going to magically disappear like Mr. Chalmers would like, unfortunately.
Yeah, it’s a bit of work. And the thing is the Reserve Bank looks at this thing called the
trimmed mean. So which is not a phrase that I talk about when I’m with friends at the parborre
era, the kids in table, you know, say, hey, look at that trimmed mean figure. Isn’t that interesting?
So give me a quick dummy’s guide education, Peta Tilse’s. Okay. So headline CPR is 2.8%.
The trimmed mean is sTilse 3.5%. What it means is it just looks at 70% of the stuff in the middle.
If you can imagine like a row of what’s the highest inflation to the lowest inflation.
And they cut off the two end bits and they look at the stuff in the middle.
It’s the stuff in the middle is what they’re measuring. And so what they’re trying to do is
literally exclude the electricity price, that huge move in electricity prices.
That is actually excluded. So. Okay, which is why the thing is higher.
Yes, correct. And so that’s why the Reserve Bank is like, well, we’re not looking on the corners
here. We’re looking straight down the middle and we’re not moving. Now, I know you’re an
economist, but so let me ask you about politics. What this reveals is that the stimulus or the
cost of living relief, as it was called, that’s a political phrase from the previous Premier
Stephen Miles and the current federal government in Canberra through say Jim Chalmers. In a sense,
that works. It does bring down or looks like it’s bringing down inflation, but it’s technically
it has. But it’s artificial and it’s temporary. And so it actually covers up what’s really going
on in the real economy. Am I being reasonable? Yep, absolutely. And I think I heard the
Treasurer speaking last night and saying, oh, and wages are up and da da da da. Yeah, wages are up.
So that’s another thing that feeds into inflation because people have to pay for those price
increases in jobs. So as you know, it sort of it all goes in a circle. And that’s probably the
whole point of inflation, unfortunately. So the RBA is going to look at this and they’re going to
say, hang on, the trimmed mean is at 3.5%. That’s way out of our range yet. We’re not going to bring
the cash rate down yet. Correct. And I think Commonwealth Bank removed their prediction for
a rate cut before Christmas. And most of them are sort of all looking at sort of February,
March, maybe even May for the next rate cut. So it’s just getting pushed, kicked down the road
at this stage. I look forward to the kitchen tables and the pubs of Australia say, hey,
look at that trimmed mean figure. Peta Tilse, thanks very much for your time. Thanks, Steve.