THE NEWS WRAP: Interest rates on hold but shares and the dollar dip

The post mortem of the drawn out Federal Election has thoroughly dissected what a returned Gillard government will mean for businesses.

Small businesses in regional Australia will be pleased to hear about the $9.9 billion promised to rural areas in order to sway independents Rob Oakeshott and Tony Windsor. 

A Labor victory also means that the National Broadband Network won’t be dismantled, although analysts have warned that the network won’t be a panacea to those who don’t currently get high-speed broadband.

Business reaction

Business leaders had barely muttered their congratulations to Julia Gillard before calling for widespread tax reform.

A “tax summit” is set to be called, with the mining resource tax set to be top of the agenda.

Rates on hold but shares and the dollar dip

As the election drama was unfolding yesterday, the Reserve Bank decided to keep interest rates on hold, although it’s expected that the rate could rise in the coming months.

The markets didn’t react well to the Labor victory, with mining companies’ stock trending downwards. 

The Australian dollar also dipped against its US counterpart, down to US 91.18 cents following the independents’ announcement. 

Hogan and hemlines

Away from politics, Paul Hogan continues to make headlines for his tussle with the ATO. The Australian Financial Review reports that Hogan’s adviser is to be prosecuted by the tax office.

The Fin also runs with the bombshell that women’s hemlines are set to drop, due to uncertain economic times.