The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Wednesday, May 11, 2011

UBS's Johnson: "Budget 11/12 -- good for bonds, not RBA"

UBS's Matt Johnson had this to say:

"There are no implications for monetary policy. We still expect the RBA to tighten twice in H2’11 (August and November). The fiscal impulse (as measured by the year to year change in the fiscal balance as a % of GDP) is basically unchanged. The fiscal contraction in 2011/12 is 10bps larger than the 2010/11 MYEFO, however this is both economically and statistically insignificant. The larger fiscal contraction in 2012/13 (70bps larger than 2010/11 MYEFO), may eventually slow the RBA however it is too far off to rely upon just now...

While fiscal stimulus continues to be withdrawn, it is not being withdrawn at a pace that’s materially faster than previously indicated – and as such we do not think there’s any new information in this budget for the RBA. As such, we maintain our forecast for two rate hikes in H2’11."
at 6:32 AM