Today is the new day of the new financial year in Australia. For most of Australian businesses and general public, the financial year ends on the 30June, and the new one starts on the 1July.
So what can be expected for this financial year, from my perspective, I can't see as many positives as I can see the negatives. Lets start with the negatives.
- The interest rates are expected to rise. My prediction is that mortgage rates will hit 10% by the end of the year. Recent reports of the slowing down in the economy such as spending in retail and housing will probably stop the interest rate from going much further than 10%.
- The petrol prices will continue to increase. Even though there was a recent conference among the oil producers to help reduce the cost of oil, I feel that the days of seeing the pricing at around $1.20/ltr are long gone. I expect to see the price of unleaded petrol to hit $2/ltr by the end of the year.
- Australian manufacturing industry to slow down dramatically. The current Australian economy is really riding on what the land can provide, more correctly, what the underground can provide in mining. Another industry such as manufacturing, services and farming will probably suffer due to environmental reasons and economic reasons. Personally, I would like to see the manufacturing industry enjoying the same economic boom as the mining industry, I don't think it will happen in the near future.
- Due to the on-going drought and increasing fuel pricing, the groceries prices will be increasing.
- Our superannuation fund is on its way to give one of the worst return ever. We can blame the US subprime problems for this.
A couple of the positives are
- The personal tax rates have changed, which means that you should be getting a little bit more in your pocket each payday.
- With the increase of petrol, focus on alternative energy are being looked at in a serious way. So hopefully, a commercially viable solution is not too far in the future.
With those predictions, let's try make the best of the new 08/09 financial year by viewing the negatives as problems which solutions are to be created for, especially on a personal finance level.