PRESS DIGEST-Australian General News - Aug 6

Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy.

THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)

The central bank has indicated a cut in official interest rates in the near future, following a 1 percent slump in retail sales during June. Reserve Bank of Australia (RBA) governor Glenn Stevens said yesterday the RBA board was moving towards a 'less restrictive stance of monetary policy' to offset a slide in demand. Financial markets are betting on an interest rate hike at next month's board meeting. Page 1. --

Decisions at Australia and New Zealand Banking Group's (ANZ.AX) (ANZ) institutional division are not being conveyed fully to the board, according to an operational review commissioned by chief executive Mike Smith. Mr Smith ordered the review after the bank was caught up in the collapse of Opes Prime, with the bank's exposure to the stock-lender said to have shocked directors. ANZ warned last week its debt provision would rise by A$1.2 billion in the second half. Page 1.

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The competition watchdog has flagged mandatory unit pricing for Australian supermarkets and an overhaul of planning laws to encourage new entrants in the sector. In a six-month inquiry into grocery prices, the Australian Competition and Consumer Commission found that Coles (WES.AX) and (WOW.AX) Woolworths had a combined 70 percent share of the market, and, together with listed wholesaler Metcash, controlled the 'balance' of supply and pricing. Unit pricing requires retailers to display the price of goods per unit of measure. Page 1.

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The car industry has questioned the Federal Government's forecast revenue from the luxury car tax increase, following a sharp drop in sales of expensive cars after customers bought in June to beat the rise. Figures from the Federal Chamber of Automotive Industries show sales of vehicles above the threshold of A$57,123 dropped by approximately one-third from June to last month. The fall came amid a smaller overall car sales drop of 2.7 per cent, compared to July 2007. Page 3.

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THE AUSTRALIAN (www.theaustralian.news.com.au)

Sources within the Liberal Party say former treasurer Peter Costello will not directly challenge Opposition Leader Brendan Nelson, but will take the role if Dr Nelson steps aside. Mr Costello would also stand if anyone else challenged Dr Nelson. On the eve of a 10-day overseas trip, Dr Nelson last night refused to confirm if he had spoken to Mr Costello since the latter's return from a holiday last week, but said he would not be stepping aside. Page 1.

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Australia's baby bonus scheme and other family payments produce only a small increase in the birth rate and may even produce negative side effects, according to the Productivity Commission. A report by the commission found that the economy, job availability, and a trend towards older first-time births were all far more important factors in the birth rate. Family welfare payments cut the long-term cost of having children by between 3 and 4 percent. Page 2.

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In the wake of public pressure, the Australian Federal Police (AFP) will make public an uncensored version of its submission to the Clarke inquiry into last year's botched investigation of Indian doctor Mohamed Haneef for terrorism links. A spokesman for the inquiry said the AFP was attempting to comply with the request from inquiry chairman John Clarke. The AFP has been repeatedly criticised for ignoring advice from the Australian Security Intelligence Organisation that Dr Haneef was not a threat. Page 3.

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