The building housing one of Sydney’s best restaurants just sold for $6.7 milllion

The food is Argentinian, the chefs are Australian and the landlords are Chinese after the site of Surry Hills restaurant Porteño sold last week for $6.66 million.

The vendor was also a Chinese investor and Andy Hu, associate director at agent Knight Frank said Cleveland Street property was an excellent investment with a yield of 5.36%.

“Surry Hills is a growth area at the fringe of the Sydney CBD and a good investment location. The high-profile tenancy’s lease to Porteno Restaurant until 2020, plus a further five-year option, was a huge drawcard for investment,” he said.

The site was Dimitri’s Greek restaurant before Porteño, owned by chefs Ben Milgate and Elvis Abrahanowicz, opened in 2010. The restaurant is sale comes 16 months after the two-storey bar and Argentinian grill restaurant was extensively damaged in a fire and closed for several weeks for repairs.
The upstairs bar, Gardels, has been named Sydney’s best bar and the ‘two hat’ restaurant is regularly named one of Australia’s top 50 restaurants.

Porteño is Spanish slang for a native of Buenos Aires native and pays tribute to Abrahanowicz’s family heritage. The meat is cooked on adjustable charcoal grills and open fire pit is used to slow-cook whole lambs.

Andy Hu from Knight Frank said it was rare for a property like this to come up for sale.

“Surry Hills is historically a tightly-held market so this was a great find for the buyer,” he said .

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Chinese commodity futures just got crushed

Chinese bulk commodity futures endured another bloodbath on Monday, recording falls of 5% or more.

The most actively traded September 2016 iron ore future on the Dalian Commodities Exchange finished the session at 353 yuan, representing a decline of 4.97%.

Earlier in the day it traded down to 350 yuan, or 6%, its maximum allowable daily decline based on existing exchange rules.

The sell-off corresponded with news that Chinese iron ore port inventories swelled to over 100 million tonnes last week, the highest level seen since March 2015.

According to Bloomberg, citing data from the Shanghai Steelhome Information Technology Company, inventories swelled 1.6% to 100.45 million tonnes, leaving them up 7.9% from levels seen at the start of 2016.

That, along with signs that Chinese steel production may be slowing after hitting a record-high in March, may have contributed to Monday’s weakness.

Hinting that the decline was related to the steel market rather than iron ore specifically, rebar and coking coal futures were also hammered, falling 5.21% and 5.37% respectively.

Like iron ore, they too traded limit down earlier in the session.

Mirroring the movement in Chinese futures, the spot iron ore price tumbled on Monday, recording one of its largest one-day losses on record.

According to Metal Bulletin, the spot price for benchmark 62% fines fell by $3.67, or 6.69%, to $51.22 a tonne, extending its losses from April 21 to 27.3%.

It was the third largest percentage decline registered in the past two years, and left the price at levels last seen on March 3.

Despite the recent sell-off, the price has still risen 17.6% over the course of 2016.

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Telstra is still facing problems two days after its last network failure

Australia’s biggest telco is still facing problems with its network, more than two days after its NBN and ADSL broadband went down on Thursday evening.

A number of users have already taken to Twitter to report the issue with some saying that have not been able to access the internet since Thursday.

According to aussieoutages.com, problems with Telstra began surfacing at 5:57 AM EST on Sunday.

The telco released a statement on Saturday evening saying they were working to restore NBN and ADSL services but said today that “residual issues are taking longer than expected to resolve”.

More than 375,000 customers have been affected by the spout of outages from the telco this year which has led to two free data days.

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Victoria is banning e-cigarettes in smoke-free places

E-cigarettes will be banned in smoke-free places across Victoria under new laws by the Andrews government.

The anti-smoking laws will treat e-cigarettes as tobacco and will prohibit vaping in outdoor dining areas such as restaurants, cafes, festivals as well as sporting events.

The measures will also mean that children under 18 won’t be able to purchase e-cigarettes. The aim is to curb young people from developing an early habit of smoking and becoming addicted to nicotine in their later years.

“We’re going to regulate them like they are a tobacco product and also make sure that we’re not really using e-cigarettes as a starting point for people to get a habit to then start cigarettes and then get addicted to nicotine,” minister for health and ambulance services Jill Hennessy told the ABC.

“We don’t want e-cigarettes being used to glamorise smoking by people under 18.”

Quit.org.au estimates that around 4,000 people in Victoria die every year from diseases caused by smoking.

The new laws are set to be introduced into parliament on Tuesday.

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It doesn’t look like the RBA is in a rush to cut rates

If there’s one thing that Reserve Bank of Australia board member John Edwards likes to do, it’s to create a stir on a sleepy Friday afternoon in Asia.

In an interview with the Wall Street Journal, Edwards expressed a lack of urgency to bring Australia’s core inflation rate — currently running at an annual pace of 1.55% — back into the RBA’s 2-3% target band, fitting with the minutes of the bank’s May monetary policy meeting which indicated that board members had to be “persuaded” to cut interest rates at to a record low level of 1.75%.

“It is certainly right to say that, at this point it is below target,” Edwards told the Journal. “But then it has never been the view that the target had to be achieved each and every quarter, or for that matter each and every couple of quarters, or year for that matter”

“The target exists, and I think it will be desirable to return over time to the midpoint of the target, but I don’t think it can be done urgently, “ he said, adding that he didn’t know of any solution to help lift inflation in the near-term, acknowledging that slow wage growth was one major influence keeping inflationary pressures low.

Certainly not a view one would expect from a central banker pondering whether to deliver back-to-back rate cuts in an attempt to bring inflation back to within target.

Keeping on the inflation theme, Edwards also poured cold water on the notion expressed by some private sector economists that the bank should consider lowering its inflation target, suggesting that the current target has served the country well.

“It would be wildly premature to actually change the target on the basis of what we know now,” Edwards told the Journal. “It would be a calamity to adjust the target downwards and then discover inflation is on the way back up again.”

Rather than the continued focus on returning inflation to target, Edwards suggested that the anchoring of inflation expectations was more important, acknowledging that it would be critical to the outlook for interest rates.

“(The key question is) are inflation expectations anchored around where they had been, and so far I think they probably still are,” he said.

Though only one member of the RBA board, Edwards’ view does not fit with the view presented by some analysts who are forecasting that interest rates will be cut to 1%, or lower, in order to help counteract disinflationary pressures that have intensified in recent quarters.

While few can fault the track record of the RBA, it’s been second to none for decades, if there’s one criticism that could be levelled at the bank it would be that it’s been overly conservative in recent years, being prompted to ease policy rather than premeditating periods of weakness.

Though a slow and steady hand with interest rates is a necessity to ensure households and businesses have confidence to make investment decisions, sometimes reacting too slowly can have even greater negative implications.

It could be argued that this conservative approach cost the bank the opportunity to address building disinflationary pressures in late 2015.

In the end they it didn’t act until prompted, again following the release of the quarterly CPI release in April.

Over the same period wage inflation fell to a record low and the Australian dollar strengthened, two factors that will almost certainly add to disinflationary pressures in the quarters ahead.

Now many believe the board will wait until its August policy meeting before easing policy further, once again based on the belief that it will want to see the next set of inflation figures.

Given heightened uncertainty surrounding the economic outlook, at a time when inflationary pressures are close to non-existent, it’s not surprising that some analysts believe that rates are going significantly lower.

If you think that’s still unlikely, just remember how many were predicting rates would eventually fall to 1.75% at the start of 2015.

You can read more from the Journal here.

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