Myer sales up in Q1; Increased debt limit could be breached in six months; Consumer sentiment lifts in November: Midday Roundup

Myer has reported a 0.44% growth in total sales for the first quarter of 2013-14 to $691.1 million amid gloomy predictions for the retail sector and ongoing works at three of the company’s department stores.

Myer chief executive Bernie Brookes said “whilst trading prior to the federal election was subdued, the trend improved modestly during the quarter and has been less volatile than in the months prior to the election, but continues to be patchy.”

The chain reports that moves to offer 15,000 of its most popular items for sale online were gaining traction and a warehouse distribution centre was built in October.

Increased debt limit could be breached in six months

The Senate appears to be forming a roadblock for the government’s attempts to raise the national debt ceiling to $500 billion.

Greens and Labor senators say they will not pass legislation to raise the credit limit by $200 billion without justification from the government.

Labor frontbencher Tony Burke told ABC Radio this morning that his party would consider evidence such as the Mid-Year Economic and Fiscal Outlook, and hinted they would not oppose a $100 billion rise to $400 billion.

Australia is expected to exceed its current debt-cap of $300 billion on December 12.

Treasurer Joe Hockey wrote in The Australian this morning that raising the debt cap to $400 billion “would be inadequate”, and to “provide a responsible buffer” the limit should be $500 billion. He said a rise to $400 billion risked revisiting negotiations in “six to 12 months”.

Consumer sentiment lifts in November

The latest figures show a modest lift in consumer sentiment in November, buoyed by low interest rates and rising house prices.

The Westpac-Melbourne Institute Index of Consumer Sentiment showed a 1.9% lift for the month to 110.3, once more approaching its 2013 peak.

Despite confidence improving, consumers are still concerned about their job security, which is preventing any major improvements.

Home owners were found to be more confident then renters and unemployment numbers are continuing to negatively impact sentiment.

Westpac chief economist Bill Evans said in a statement the Reserve Bank should hold off on any further cuts to interest rates until more data is available.

“At this stage we think the best policy response will be to cut in February,” he says.

“Some of the big issues for policy are around a very strong housing market in some regions of the country, particularly in Sydney, and very soft job markets.”

Shares fall on open

The Australian sharemarket has dropped on open, on the back of losses on global markets overnight.

The S&P/ASX 200 benchmark had fallen 28.1 points to 5365 at 11:58am AEDT. Last night the Dow Jones closed down 32.43 points to 15,750.67.