Australia’s banks should use artificial intelligence to enrich their customers’ lives and help address hesitation towards the technology, the corporate watchdog says.

The nation should not rush into heaping more regulation on AI as guardrails are already in place and more rules could have a chilling effect on innovation, ASIC chair Joe Longo will tell a roomful of bankers in Sydney on Wednesday.

Mr Longo has previously cautioned against over-regulation more generally, and will again urge lawmakers not to address a perceived problem by simply throwing more rules at it.

“The reality is, as I have said publicly before, the more specific and narrowly targeted regulation becomes, the more complex it becomes,” Mr Longo will say in a speech at an Australian Banking Association conference.

“It gets harder to understand, harder to comply with, and harder for regulators to enforce.”

That results in a burden borne by all Australians through lost time and productivity, and makes it harder for regulators to combat scams, predatory lending and other unfair practices.

“And it becomes a handbrake on innovation, when you have got to spend more on compliance lawyers than coders.”

While ASIC is not rushing to impose new regulation, Mr Longo acknowledges more may be needed in future.

But his focus is on applying existing laws. Guardrails already exist, and regulators just need to be more imaginative about how to apply them.

“In other words, we’ve got to kick the tyres a bit and see just how far our technology-neutral framework will flex,” Mr Longo will say.

ASIC is still keeping a close eye on how businesses adopt AI, and Mr Longo wants to see banks using AI to actually improve their customers’ lives.

This could include preventing low-income customers from paying millions of dollars in fees they were entitled to avoid, as ASIC found in a report on the banks’ treatment of Indigenous customers.

He cited the example of a single mum from South Australia who was charged more than $2600 in overdraw fees over five years.

“It would be a true win for customer-centric banking if your algorithm prompted you to serve your customers better before an ASIC report did,” he will say.

“We’ve already seen that customer trust in AI and its potential to improve customer service is eroding. If banks get this wrong, we’re likely to see a significant setback in AI legitimacy and trust.”

The level of Australian businesses going under appears to be stabilising, but firms are still becoming insolvent at record-high numbers.

Restaurants and construction firms remain hardest hit in CreditorWatch’s monthly Business Risk Index, which found more than 14,000 businesses went bust in the 2024-25 financial year.

But income tax cuts and government cost of living measures have helped the rate of insolvencies plateau, CreditorWatch said.

And with defaulted payments falling 6.5 per cent in June, there is some hope the overall health of businesses is on the up.

“It’s a promising signal business cash flow pressures may be easing, but with insolvencies still running 33 per cent above 2024/25 levels, and particularly elevated in hospitality and construction, I’m not getting too excited just yet,” CreditorWatch CEO Patrick Coghlan said.

“We’ll continue to monitor for early signs of sustained recovery, but the next six months will be critical for determining whether insolvency rates begin to fall or remain stubbornly high.”

Businesses were struggling to stay afloat in typically stable sectors such as health care and education, showing the breadth of the economic strain, Mr Coghlan said.

Hospitality businesses remain under the pump, with one in 10 closing in the year to June 2025.

While insolvencies have plateaued generally, they remain trending higher among the food and beverage sector.

Australian Restaurant and Cafe Association CEO Wes Lambert said it was no longer a case of if a hospitality business would close, but rather which one would shut it doors.

“It’s a real threat for many businesses in the hospitality industry, especially those in CBDs with work-from-home now fully enshrined into employment culture, and with tourism remaining at levels not seen since 2016,” he told AAP.

“Demand is low while wages, rents, utilities, insurance and other expenses are between 30 and 50 per cent higher than they were before COVID-19.”

Mr Lambert said Australia needed to attract more tourists, and needed genuine discussion about the cost pressures on industries such as hospitality.

A quarter of all business that became insolvent in 2024/25 were in the construction sector.

But given the large overall number of construction businesses, less than one per cent of all of them became insolvent.

CreditorWatch labelled a rise in education and healthcare insolvencies “somewhat unusual” given both sectors are largely underpinned by government funding.

Education was hit by immigration and foreign student policies, they found.

The 14,716 business insolvencies recorded in 2024/25 was a massive 33 per cent jump year-on-year.

Students and graduates will soon see a reduction in their HECS debts and save hundreds of dollars a year.

Federal Education Minister Jason Clare will introduce legislation to slash student debt by 20 per cent and increase the income that graduates need to earn before minimum repayments kick in.

It’s the first bill that the Albanese government will put before parliament at the start of its second term. 

People earning between $60,000 and $180,000 will save hundreds of dollars each year under the changes. 

Someone on $70,000 will save the most, $1300 a year, on minimum repayments due to an increase to the thresholds at which the debts must be paid back.

Savings vary between incomes in the bracket, with people pocketing anywhere from $200 to $850.

Bruce Chapman said it would make it fairer by giving those on lower salaries more money in their pockets, while their debts remain the same in nominal terms.

“It looks bigger, in real terms it’s not bigger,” the architect of the HECS scheme told AAP. 

But the top priority should be reviewing the price of each degree because humanities students finish with the highest level of debt and end up being the lowest-paid graduates.

“All the prices are wrong,” Professor Chapman said.

Mr Clare said reforms were being looked at, after the failure of the former Liberal government’s job ready program.

The program aimed to fill skills shortages by making it cheaper to study courses like teaching, nursing and psychology while doubling the cost of popular degrees including law, communications, business, humanities and the arts.

“If the intention there was to reduce the number of people doing arts degrees, it hasn’t worked,” Mr Clare said.

“People study the courses they’re interested in, that they want to do, that they love.”

The universities accord final report branded the program “deeply unfair” because it punished students following their interest, and called for it to be scrapped.

It recommended that fees reflect future earning potential, as part of 47 recommendations to reform the sector.

Other aspects about how HECS is paid off also needed to be addressed, Prof Chapman said.

HECS repayments are taken from a person’s pay slip if they’re earning above an income threshold.

But the money isn’t immediately taken off the HECS debt and is instead deducted as a lump sum at the end of the financial year after indexation has been applied on June 1.

This means a higher debt is indexed as the repayments haven’t been deducted and the university accord recommended it be reformed to make the system fairer. 

The Australian Tertiary Education Commission has been established in an interim capacity to implement long-term university reform and will review the HECS system over the next 12 months.

Mr Clare will introduce further legislation in the coming months to set the commission up as a permanent body.

Pomp and ceremony out of the way, federal politicians will get back to work as parliamentary business resumes.

The 48th parliament officially opened with a day of pageantry, which included a traditional church service and smoking ceremony before politicians were sworn in.

Prime Minister Anthony Albanese and Opposition Leader Sussan Ley will square off in parliament as rival party leaders for the first time on Wednesday.

Education Minister Jason Clare will deliver on Labor’s election promise by introducing legislation to the lower house to slash university debt for three million Australians by 20 per cent.

The coalition is expected to support the move which will wipe $16 billion off student debt but is waiting to see the fine print.

People with an average HELP debt of $27,600 will have $5520 wiped from their loans.

The government has also said it will this week introduce childcare reform aimed at improving safety measures.

Labor returns to parliament with a lion’s share of 94 seats, to the coalition’s 43 in the lower house.

Melbourne MP Sarah Witty, who defeated former Greens leader Adam Bandt at the election, gave a heartfelt first speech to parliament on Tuesday evening.

She tearfully spoke of enduring “heartache after heartache” for more than a decade after experiencing pregnancy loss.

“We grieve deeply,” she said.

“I opened myself to a new path. I stepped into the world of foster care, not out of ease, but out of a deep need to turn my pain into something positive.”

Ms Witty said her experience taking care of children in need would shape her approach as an elected parliamentarian.

Griffith MP Renee Coffey, who wrested back Kevin Rudd’s old seat for Labor from the Greens, spoke of the kindness former rival Max Chandler-Mather had shown her following a confronting interaction with a voter.

“On election day, I was stunned when a voter told me he couldn’t possibly vote for me because I have MS and he couldn’t be represented in parliament by someone who could be in a wheelchair,” she said.

“It knocked the wind out of me. In a strange turn of fate, it was the then-member for Griffith, Max Chandler-Mather, who saw me step away from that interaction.

“And the kind words of support he offered me, I will never forget.”

US Treasury Secretary Scott Bessent says he will meet his Chinese counterpart next week in Stockholm and discuss what is likely to be an extension of an August 12 deadline for a deal to avert sharply higher tariffs.

Bessent told Fox Business Network that trade with China was in “a very good place” and the meetings in Sweden would take place next Monday and Tuesday.

“I think we’ve actually moved to a new level with China, where it’s very constructive and … we’re going to be able to get a lot of things done now that trade has kind of settled in at a good level,” Bessent said.

Swedish Prime Minister Ulf Kristersson confirmed in a post on X that Sweden will host the US-China trade talks early next week.

“It is positive that both countries wish to meet in Sweden to seek mutual understanding,” Kristersson said.

Since mid-May, Bessent has met twice with Chinese Vice Premier He Lifeng in Geneva and London to work out and refine a temporary trade truce that dialled back duelling triple-digit retaliatory tariffs that threatened to cut off all trade between the world’s two largest economies.

US Trade Representative Jamieson Greer, Commerce Secretary Howard Lutnick, China’s Commerce Minister Wang Wentao and chief trade negotiator Li Chenggang also participated in those talks.

In talks so far, China has agreed to end its export ban on rare earth metals and magnets to the US while the US agreed to restart shipments of semiconductor design software and production materials as well as commercial aircraft engines and other goods to China.

But the two sides set a 90-day deadline to resolve deeper issues, including US complaints about China’s state-led and subsidised export-driven economic model that has created excess manufacturing capacity in China that is flooding world markets with cheap goods.

China denies that it subsidises its industries and attributes their export success to innovation.

Tariffs could snap back to 145 per cent on the US side and 125 per cent on the Chinese side without a deal or negotiating extension.

“We’ll be working out what is likely an extension” at the Stockholm talks, Bessent said, adding that US officials would discuss other issues including reducing China’s over-reliance on manufacturing and exports.

“Hopefully we can see the Chinese pull back on some of this glut of manufacturing that they’re doing and concentrate on building a consumer economy,” Bessent said.

He said he also wants to issue warnings to China about continuing to buy sanctioned Russian and Iranian oil and China’s efforts to aid Russia’s war against Ukraine.

Bessent said that there was bipartisan support in the US Senate for legislation aimed at imposing tariffs of 100 per cent on goods from countries that continue to buy Russian oil, namely China and India.

“I’m going to be in touch with my European counterparts. The Europeans that have talked a big game about sanctioning Russia, and it’ll be very important for the Europeans to also be willing to put on these high level of secondary tariffs for sanctioned Russian oil.”

He said that the US was poised to announce “a rash of trade deals” with other countries, and Japan could be among these despite an election setback for Japan’s ruling party and difficult negotiations.

“I wouldn’t be surprised if we aren’t able to iron out something with Japan pretty quickly,” Bessent said.

Nonetheless, he said that for most countries, tariffs would “boomerang” back towards April 2 levels from the current 10 per cent but negotiations on trade deals could continue.

US President Donald Trump has welcomed Philippine President Ferdinand Marcos Jr to the White House, saying the two countries are close to finalising a trade agreement.

“We’re going to talk about trade today and we are very close to finishing a trade deal, a big trade deal actually,” Trump told reporters at the start of his meeting with the Philippine leader.

Trump has already struck trade deals with two regional partners of the Philippines – Vietnam and Indonesia.

The United States had a deficit of nearly $US5 billion ($A7.7 billion) with the Philippines last year on bilateral goods trade of $US23.5 billion. 

Trump this month raised the threatened “reciprocal” tariffs on Philippine imports to 20 per cent, from 17 per cent threatened in April.

Trump said the two countries did “a lot of business” with each other, saying he was surprised to see what he called “very big numbers” that would only grow under a trade agreement.

Gregory Poling, from the Washington’s Center for Strategic and International Studies, said Marcos might be able to do better than Vietnam, with its agreement of a 20 per cent baseline tariff on its goods, and Indonesia at 19 per cent.

Trump underscored the importance of the US-Philippine military relationship.

“They’re a very important nation militarily and we’ve had some great drills lately,” he said.

Marcos, who arrived in Washington DC on Sunday, went to the Pentagon on Monday for talks with Defense Secretary Pete Hegseth and later met with Secretary of State Marco Rubio.

During his trip, he will also meet US business leaders investing in the Philippines.

Coca-Cola says it will add a cane sugar version of its trademark cola to its US line-up this year, confirming a recent announcement by US President Donald Trump.

Trump said in a social media post last week that Coca-Cola had agreed to use real cane sugar in its flagship product in the US instead of high-fructose corn syrup.

Coke did not immediately confirm the change but promised new offerings soon.

On Tuesday, Coca-Cola chairman and CEO James Quincey said Coke will expand its product range “to reflect consumer interest in differentiated experiences”.

Coke currently sells Mexican Coke, which is made with cane sugar, in the US.

“We appreciate the president’s enthusiasm for our Coca-Cola brand,” Quincey said in a conference call with investors on Tuesday.

“This addition is designed to complement our strong core portfolio and offer more choice across occasions and preferences.”

Coca-Cola reported better-than-expected earnings in the second quarter as higher prices offset weaker sales volumes.

Case volumes fell 1 per cent globally and 1 per cent in North America but Coke said on Tuesday that pricing rose 6 per cent for the April-June period.

One bright spot was Coca-Cola Zero Sugar, which registered a growth in volume of 14 per cent.

Traditional Coca-Cola still far outsells the zero-sugar variety but consumer demand for zero-sugar versions is growing much more quickly.

Global case volumes of juice, dairy and plant-based beverages fell 4 per cent, Coke said.

Sports drink case volumes were down 3 per cent as higher demand in North America was offset by declines in Latin America.

Australia is on track to strike Brisbane Olympic gold, with the 2032 Games forecast to pump more than $70 billion into the national economy.

But a business expert has played down the Olympic-sized impact touted on Tuesday, warning the cost of preparing for a Games might outweigh the benefits.

The seven-year countdown to the 2032 Games has begun, with a Deloitte Economics Report predicting the country would benefit from tens of billions of dollars post-Games.

The report forecast the Games would help inject $39.5 billion and create 7800 additional full-time jobs for Queensland’s southeast through to the year 2052.

The remainder of Queensland was set to receive $19.3 billion and 4900 extra jobs, with $11.8 billion and 4700 additional jobs for the rest of the country over the 20-year period.

“In some sense, the exact dollars don’t matter,” Deloitte Access Economics’ Pradeep Philip told a packed Brisbane event boasting Olympic heavyweights on Tuesday. 

“It’s the magnitude and the trajectory of our economic growth that is important.”

A forecast volunteering uptick is set to attract 50,000 mostly Australian people, and is expected to contribute to higher labour productivity, feeding the economic boom.

Transport, event and public infrastructure set to be built for the Games would also contribute to the long-term economic legacy, Mr Philip said.

Brisbane’s enhanced reputation was also expected to be factor, contributing to higher pre-and post-Games tourism as well as boosting merchandise exports and foreign direct investment.

Australian Olympic Committee CEO Mark Arbib said the report was “music to our ears”.

“We can’t wait for Brisbane 2032, the world is going to come to Queensland,” he said.

But business expert Sheranne Fairley claimed projects rarely came in on budget and warned the Brisbane Olympics may not have a positive economic legacy.

She urged people to keep a healthy amount of scepticism about the touted impacts, with a string of previous Olympic host cities enduring cost blowouts.

“Pretty much every Games we’ve ever had, we’ve touted economic benefits and said there’s going to be all these positive benefits,” the University of Queensland academic told AAP. 

“But we see a lot of the time, there’s cost blowouts. 

“Then there’s really no sustained tracking of what those benefits are.”

She said multiple studies would likely be completed after the 2032 event boasting different Games impacts, but believed it would be difficult to determine its overall legacy.

She cited the 2018 Commonwealth Games hosted by the Gold Coast, saying some businesses were left “high and dry” when they ordered extra stock for the expected influx of visitors that never came.

“There were certainly some businesses that were left out of pocket,” she said.

Glasgow will host a pared-down Commonwealth Games in 2026 after Victoria reneged as host, citing contentious cost blow-outs.

Yet Brisbane Olympic boss Andrew Liveris said the 2032 Games legacy would be different, after being hosted under new reforms.

Brisbane organisers will abide by the Olympic “new norm” that encourages host cities to use existing or temporary venues to help ensure a more affordable, beneficial and sustainable Games.

“We will deliver a Games for the entire region and the entire country that happens to have the word Brisbane as its headline,” he told function on Tuesday.

The 2032 Olympics will ensure Queensland had a reputation for “warmth, hospitality, openness” lasting beyond the event, he said.

The clock is ticking for the Games after the Queensland government finally confirmed its venue blueprint in March, more than 1300 days after Brisbane was named host city.

Victoria Park in Brisbane’s inner city is expected to become the Games hub, with a 63,000-seat main stadium as part of a $7.1 billion venue funded by the state and federal governments.

Pomp and ceremony were on full display as MPs gathered in Canberra for the opening of federal parliament.

But as formal traditions dating back hundreds of years played out at Parliament House, protests called for action on conflict in the Middle East.

During Governor-General Sam Mostyn’s speech laying out the priorities for the three years ahead, more than a dozen pro-Palestinian demonstrators were detained after protesting inside the foyer of parliament, before being removed from the building.

Hundreds of protesters called for sanctions on Israel on the lawns of parliament, with one woman arrested, federal police say.

Traffic around Parliament House was also disrupted by the protests.

As the governor-general read her speech, Greens senator Mehreen Faruqi held a silent protest by holding a sign that read: “Gaza is starving. Words won’t feed them. Sanction Israel”.

Ms Mostyn said cost-of-living relief would be high on the agenda for the next term.

“(Voters) re-elected a government that will continue building on the foundation of its first term, upholding the values of fairness, aspiration and opportunity,” the governor-general told the upper house.

“The government will work to repay the trust Australians have placed in it.”

The day began with an ecumenical service at a Wesley Uniting Church, with the prime minister promising to get down to business quickly.

“Every day is an opportunity to deliver for Australians and this week we will have legislation to do that,” he told reporters outside the church.

“We’ll continue to work hard each and every day in the interest of Australians.”

Mr Albanese will command a large majority in his second term as leader, with Labor holding 94 of the 150 seats in the House of Representatives.

The size of the majority was on display on the floor of parliament for the first time since the election, with Labor MPs sitting on both sides of the aisle in the lower house.

Across the chamber, Opposition Leader Sussan Ley presides over just 43 lower-house MPs after an election wipeout for the coalition.

“We got smashed at the last election and the number of seats that we now hold is a demonstration that we are at a low point,” Ms Ley said.

“But we’re here to work hard, we’re here to put the interests of the Australian people that we come here to represent front and centre.

“And we know that aspiration connects every single thread of Australian society.”

After a ceremonial welcome to country and smoking ceremony on the forecourt of Parliament House, MPs and senators were sworn in one-by-one at their respective chambers.

Business soon turned to the election of a speaker for the House of Representatives.

Labor MP Milton Dick was re-elected to the role with bipartisan support before being ceremonially dragged to the speaker’s chair by MPs.

The prime minister said Mr Dick would continue to conduct the role with “fairness, with humour and with intellect”.

The returning speaker said it was a “profound honour” to carry on in the position.

“My view is the role of speaker is not one of partisanship, but of stewardship, and it’s my solemn responsibility to ensure that democracy is not only practised here, but it’s strengthened here,” Mr Dick said.

In the Senate, Sue Lines was re-elected as president of the chamber, but not before One Nation leader Pauline Hanson’s surprise nomination of political rival David Pocock for the position.

The independent ACT senator declined the nomination.

After Tuesday’s ceremonial opening, formal business begins on Wednesday with legislation including for a 20 per cent reduction in HECS debt for students.

The Reserve Bank has signalled its next interest rate move as it offers further insight into a shock hold call.

Australia’s central bank on Tuesday released minutes from its July 7-8 meeting, in which its “cautious” monetary policy board defied the expectations of traders and economists by leaving the cash rate unchanged at 3.85 per cent.

Despite inflation sitting within the RBA’s 2-3 per cent target band, the economy was tracking stronger and the effects of Donald Trump’s tariffs seemed less devastating than previously feared.

That gave the board scope to wait a little longer for more inflation and jobs data to make sure inflation really was on track to stay at 2.5 per cent sustainably, the minutes said.

“Lowering the cash rate a third time within the space of four meetings would be unlikely to be consistent with the strategy of easing monetary policy in a cautious and gradual manner,” the board found.

In a 6-3 decision, the board judged it more prudent to leave rates on hold, concerned Australia’s relatively tight labour market could push wage costs and prices higher.

The unemployment rate was 4.1 per cent in May, barely changed from a year earlier, while other indicators such as high job vacancies pointed to little movement in the near term, the board noted.

Australia’s sluggish productivity growth rate weighed on the RBA’s mind, as it contributed to faster growth in labour costs.

But the board’s judgment the labour market remained tight was challenged on Thursday when the Australian Bureau of Statistics revealed the unemployment rate jumped to 4.3 per cent in June, taking the market and seemingly the RBA by surprise.

The data bolstered the case of a dissenting rump of three board members, who argued a rate cut was warranted because of downside risks “from a likely slowing in growth abroad and from the subdued pace of GDP growth in Australia”.

“That in turn posed a risk that underlying inflation would moderate somewhat more rapidly than envisaged in the May projections,” the minutes said.

Board members noted some jobs data implied “supply and demand in the labour market were closer to balance”.

Interest rate markets have almost fully priced in a 25 basis point cut to the official cash rate at the August meeting and project it will fall to 3.2 per cent by the end of the year.

Each 25 basis point cut to the cash rate would shave about $90 off monthly repayments on a $600,000 mortgage.

June quarter consumer price index data, due to be released by the ABS on July 30, is “critical” to the RBA’s next rates decision, CBA senior economist Belinda Allen said.

If underlying trimmed mean inflation prints at or below the RBA’s 2.6 per cent forecast, a cut should be assured.

“A shift lower in the annual rate of trimmed mean inflation should be sufficient to see the cash rate lowered in August,” Ms Allen said.

Another factor behind the board’s decision not to cut was the bank’s assessment that threats to the Australian economy from Donald Trump’s tariffs had eased since the previous meeting in May.

In further signs Australia’s idling economy may need a boost, government spending continues to drive the bulk of new project activity, accounting for 80 per cent of new investment in the June quarter, a Deloitte Access Economics report shows.