Angus Taylor slams Labor’s economic blueprint

Good morning. Here's what happened overnight and what you need to know today.

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1.

Taylor’s pitch: Shadow treasurer Angus Taylor is set to deliver his most excoriating attack on the government’s Future Made in Australia policy to date while attempting to reclaim the Coalition's historic position as the party of innovation and entrepreneurship. Speaking at FinTech Australia’s Intersekt Festival in Melbourne, Taylor will argue that relying on public sector growth is not a sustainable pathway to prosperity. He will echo criticism from Business Council of Australia CEO Bran Black about workplace reforms the business lobby claims are seeing capital and investment shift offshore. Arguing government spending is exacerbating inflation and economic stagnation, Taylor will cite data showing the public sector is growing at seven times the rate of the overall economy. (Capital Brief)

2.

Pager attack: Pagers used by Hezbollah members to communicate exploded almost simultaneously in Lebanon and Syria, killing at least 9 people and wounding about 2,750 others, including Iran’s ambassador to Lebanon, The Associated Press reported, citing officials. Hezbollah blamed Israel for what the militant group called a deliberate attack, threatening retaliation. The Israeli military declined to respond to AP’s questions. The explosions occurred in areas where Hezbollah has a strong presence and came hours after Israel’s Shin Bet said it had prevented Hezbollah's attempt to assassinate a former senior Israeli official with a remotely detonated explosive device. The pagers were newly acquired, and of a new brand, after Hezbollah’s leader banned cell phones, fearing Israeli surveillance, the agency said. A security expert based in the Middle East told The Wall Street Journal the operation likely involved “malware that caused the pagers’ batteries to overheat and explode or a charge placed in the devices and detonated remotely.” (Capital Brief)(AP)

3.

Retail therapy: US retail sales unexpectedly rose by 0.1% in August, driven by a rebound in online purchases that offset declines in other sectors such as autos, electronics and clothing. Sales had been forecast to fall 0.2%. Core retail sales, excluding volatile categories like autos and gas, increased by 0.3%, the fourth straight month of gains. The stronger-than-expected retail data amid a tight labour market suggests continued resilience in consumer spending even with high interest rates. It comes as economists and traders debate the magnitude of the Federal Reserve’s first interest rates cut this cycle. A trim of at least 25 basis points is seen as a certainty, but some believe a cut double that size is warranted. (Capital Brief) (US Census)

4.

Teen shield: Meta will make Instagram accounts for users under 18 private by default, limiting messaging and tagging permissions, in a move to address concerns about the negative impacts of social media on young people. Users under 16 will need parental approval to change these settings, the company said Tuesday, while parents can monitor their teens’ interactions and limit app usage. Meta plans to implement the changes within 60 days in the US, UK, Canada and Australia, later this year in the EU, and globally from January. The company also said it is developing technology to detect users lying about their age. It comes amid plans to ban children from social media in Australia and pending legislation in the US and the UK, such as the latter’s Online Safety Act. (Instagram statement)

5.

EU team revamp: European Commission President Ursula von der Leyen named her new team of commissioners to lead the European Union over the next five years. The appointments include Spain’s Teresa Ribera, known for her leadership on climate policy, as the new antitrust chief, where she will focus on regulating Big Tech and advancing the EU’s green goals, and Lithuania’s Andrius Kubilius, a former prime minister and vocal Ukraine supporter, as the first defence commissioner, tasked with strengthening military manufacturing in response to Russian aggression. The new Commission, which needs to be approved by the European Parliament, will focus on improving the EU’s competitiveness, expanding its military manufacturing capabilities and ensuring a smooth transition to green energy, von der Leyen said. France's Stephane Sejourne will oversee industrial strategy, while Estonia’s Kaja Kallas will take charge of foreign policy. (European Commission statement) (Bloomberg)(Reuters)

6.

Card switch: JPMorgan is in discussions with Apple to take over its credit card program from Goldman Sachs, The Wall Street Journal reported citing unnamed sources. Talks started earlier this year and have progressed, but key details including pricing are still being negotiated, the sources told the paper. Goldman has struggled in consumer banking and is looking to exit after incurring losses and facing regulatory scrutiny. Apple meanwhile is seeking a new issuer for the card, which has over 12 million users. JPMorgan is negotiating to pay less than the full value of approximately USD17 billion in outstanding balances, the paper said. The pair are also discussing changes to the card’s billing structure, with Apple’s requirement for statements at the beginning of the month a point of contention during Goldman’s tenure. (Capital Brief) (WSJ)

7.

Housing standoff: Prime Minister Anthony Albanese has hardened his stance on negotiating over housing as he looks to set up an election fight with the Greens and the Coalition. Labor's Help to Buy scheme has been blocked in the Senate, setting the stage for a potential election showdown. The Greens, demanding a national rent freeze, tax reforms and more, have refused to support the scheme, which would allow the government to co-invest in homes with buyers. Capital Brief reports Albanese’s focus appears to have shifted from passing legislation to positioning for a political battle, even raising the prospect of a double dissolution election over the policy, though this remains unlikely. With no counteroffer from Labor, tensions are escalating as the government struggles in the polls. (Capital Brief)

8.

Chips pact: Intel shares surged as much as 8% after it unveiled a multibillion-dollar deal to design and manufacture AI chips for Amazon’s cloud services unit, AWS in a win for a business that has struggled to secure high-profile customers. Shares surged to as much as USD22.58 ($33.44) each, before paring gains to be 3.3% higher in the afternoon. CEO Pat Gelsinger is restructuring the company, turning the foundry division into a wholly owned subsidiary and pausing factory projects in Germany and Poland. As part of its restructure, Intel plans to lay off 15,000 workers and save USD10 billion. (Capital Brief)