Marles meets US counterpart Pete Hegseth in Washington
Australia’s defence minister, Richard Marles, met with his US counterpart, secretary of war Pete Hegseth, at the Pentagon in Washington DC overnight.
A readout of the meeting released by the US says the pair spoke about the 75th anniversary of the Anzus treaty and “how both nations will continue to advance the alliance and strengthen deterrence in the Pacific”.
The US said both leaders “agreed to accelerate force posture initiatives at Australian bases, bolster cooperation in combined logistics, and build greater interoperability through joint exercises”.
They also discussed joint efforts to increase capacity for guided weapons and “next-generation capabilities”. They also spoke about advancements surrounding the Aukus submarine deal.
Pete Hegseth, right, meets with Richard Marles, left, at the Pentagon. Photograph: Mark Schiefelbein/APShare
Updated at 18.38 EDT
Key events
Patrick Commins
Markets price in 80% chance of RBA hike this month
Financial markets are now pricing in an 80% chance that mortgage holders will get hit with a fourth RBA rate hike at the end of this month, as investors fret that soaring oil prices will reignite inflationary pressures.
Yesterday’s national accounts confirmed Australia’s economy is slowing, but suggested it may not be slowing fast enough to ease capacity constraints that are pushing up costs and prices.
Traders are even now pricing in a 25% chance of a second hike by the end of the year – what would be the fifth for 2026.
Gavin Friend, a senior markets strategist at NAB, said “overall, the annual growth rate in GDP is tracking close to its trend rate and although household consumption has slowed, it appears to have been relatively resilient despite very weak consumer confidence”.
“For the RBA, the data confirm that growth has slowed a little from [the second half of 2025] but also suggests that growth has tracked around its trend rate over the past year,” he said.
NAB expects the RBA to hike later this month.
Marles says US-Australia alliance as relevant as ever
Richard Marles just spoke to the ABC from Washington DC, saying Australia’s alliance with the US remains as relevant today “as it ever has” in a “very challenging” environment.
Marles has been meeting with his US counterpart, Pete Hegseth. He was asked if he believes president Donald Trump’s ongoing conflict with Iran and the US’s posturing towards other countries had affected Australian’s trust in the two country’s relationship. He said:
double quotation markOur alliance with the United States is something that’s been built over decades. It really does transcend governments of the day.
Our collaboration as two defence forces is really central to providing deterrence and building peace and stability in the Indo-Pacific, which is ultimately what underwrites every Australians’ safety.
The alliance is as relevant today in a very challenging and difficult world as it has ever been, and it’s profoundly important that we are making sure that it continues to evolve and to grow and to meet the circumstances of the moment. And that’s what we’re doing.
The Australian deputy prime minister and minister of defence, Richard Marles, during a meeting with the US secretary of defense, Pete Hegseth, at the Pentagon in Arlington, Virginia. Photograph: Shawn Thew/EPAShare
Updated at 19.13 EDT
Taylor says degree of balance ‘always a good thing’ after Canavan’s comments on ‘feminisation’ of school curriculum
Angus Taylor was also asked on the ABC this morning about the Nationals leader, Matt Canavan, who said yesterday the “feminisation” of school curriculum had led to the rise of “manosphere” content.
The opposition leader said he was “worried” about politicisation in schools, which he didn’t want to see in curriculums. When asked about Canavan’s suggestion that there should be more male teachers to give young boys more “role models” in school, Taylor said:
double quotation markI think having a degree of balance is always a good thing. And that’s true, that’s true in everything.
Updated at 19.13 EDT
Marles meets US counterpart Pete Hegseth in Washington
Australia’s defence minister, Richard Marles, met with his US counterpart, secretary of war Pete Hegseth, at the Pentagon in Washington DC overnight.
A readout of the meeting released by the US says the pair spoke about the 75th anniversary of the Anzus treaty and “how both nations will continue to advance the alliance and strengthen deterrence in the Pacific”.
The US said both leaders “agreed to accelerate force posture initiatives at Australian bases, bolster cooperation in combined logistics, and build greater interoperability through joint exercises”.
They also discussed joint efforts to increase capacity for guided weapons and “next-generation capabilities”. They also spoke about advancements surrounding the Aukus submarine deal.
Pete Hegseth, right, meets with Richard Marles, left, at the Pentagon. Photograph: Mark Schiefelbein/APShare
Updated at 18.38 EDT
Taylor ‘very confident’ tobacco excise cut would destroy model enriching organised crime
Angus Taylor, the opposition leader, is also out stumping the new Coalition tobacco policies.
He said the opposition is “very confident” that a significant, 80% cut in the tobacco excise would “destroy the business model” of organised crime.
“I understand business and this is sadly a bad business that we have to destroy,” Taylor said.
He went on to say the “horse has bolted” already and Australia’s the “worst of all worlds right now” with rising smoking rates and rising crime.
Angus Taylor. Photograph: Pip Farquharson/AAPShare
Shadow treasurer says tobacco plans would bring in extra billions and stop people buying from the ‘black market’
Tim Wilson, the shadow treasurer, said the tobacco proposal would bring in an extra $2bn a year as it would stop people “buying products from the black market”.
When asked if the Coalition initially planned to use the same 75% tobacco excise cut figure as One Nation, Wilson said:
double quotation markWe’ve been looking at this policy for a long time, but what we’ve been looking at is how do you break it down for the different parts of the market so that we can actually break the illegal tobacco trade? …
We’ve got a government, we’ve got a One Nation position which is focused solely on tax cuts. What we’re looking at is how do we stop the black market, both with enforcement and with reduction in the excise, so that we actually get the outcome Australians want.
Shadow treasurer Tim Wilson. Photograph: Mick Tsikas/AAPShare
Updated at 18.08 EDT
Teen charged after ‘near-complete amputation’ of boy’s hand
A teenage boy will face court today after a “near-complete amputation” of a boy’s hand during an alleged assault in Sydney on Wednesday night.
NSW police were called to Redfern about 6pm last night and found a 17-year-old with a partially severed hand.
Police allege the 17-year-old was assaulted by another boy with a knife in a car park on Morehead Road.
NSW paramedics attended to the injured boy – it is not clear yet whether the hand was reattached.
Early Thursday morning after inquiries, police stopped a car travelling on Redfern Street in Redfern.
They arrested and charged a 15-year-old boy with wounding a person with intent to cause grievous bodily harm, and breach of bail.
He was refused bail to appear before a children’s court today.
Updated at 18.02 EDT
Hume says Coalition’s plan isn’t a copy of One Nation and is ‘fully costed’ and ‘fully modelled’ to tackle organised crime
The deputy opposition leader, Jane Hume, said a new Coalition plan to tackle the illegal tobacco market isn’t a copy of the one touted by One Nation.
Hume spoke to Channel Nine’s Today show this morning, where she spoke about the plan to “crush the organised crime gangs that are making billions from illegal cigarettes and vapes”. The plan has a central tenet of slashing the tobacco excise by 80%, as well as a $200m law enforcement surge to shut illegal shops and stop illegal shipments.
Pauline Hanson recently said One Nation would cut the excise by 75% if it were elected to government.
Hume said the policies were “not at all alike”, saying the Coalition’s was “fully costed, fully modelled” and would “genuinely disrupt the organised crime that has taken over the market”. She told Today:
double quotation markThis is not a slogan. This is not a headline. This is a solution to a policy problem, a failure of this government. … We have no time to waste. We have a solution. We’ve done the work. Now let’s see if we can get it adopted …
This is not a perfect solution, but it is the only solution because the alternative, maintaining the same thing, means that criminals take over.
Jane Hume. Photograph: Mick Tsikas/AAPShare
Updated at 17.47 EDT
AI to be greatest change ‘since electricity’, Paul Keating says
Artificial intelligence is set to be the “greatest agency for change” since the introduction of electricity, former prime minister Paul Keating said.
AAP reports Keating made the comments at a sold-out Sydney writers’ festival event on Wednesday evening. He said Australia needed to boldly take on the challenges posed by AI.
“[Artificial intelligence] I think is going to be … certainly since the discovery of electricity, the greatest agency for change,” he said.
He also commended the federal Labor government’s recent changes to the capital gains tax to make housing more affordable as an example of the kind of change needed in the future.
double quotation markAnd if we’ve lost 10 or 15% [of] house values, so what?
Paul Keating. Photograph: Sitthixay Ditthavong/AAPShare
Updated at 17.29 EDT
Good morning, Nick Visser here, welcome to Thursday. Let’s see what the day holds.
ShareAustralia pledges $3m additional aid
Australia will deploy a team of specialist drone operators to help the search and rescue effort in the deadly Nepal-Tibet floods.
Operators, including those from Fire and Rescue New South Wales and the Queensland fire department, will head to the disaster-struck region in the coming days.
It comes as the Albanese government has announced a further $3m in aid, bringing its total figure pledged to $11m.
The number of Australians unaccounted for remains at 38.
It comes as a RAAF plane arrived yesterday with humanitaian aid.
As of Thursday, Nepal’s National Disaster Risk Reduction and Management Agency reported 1,204 confirmed deaths and 4,216 missing persons (including 583 foreigners).
Residents pull a newly installed zipline to help people commute across the Trishuli River in the aftermath of flash floods at Bidur in Nepal’s Nuwakot district on Wednesday. Photograph: Rajesh Kumar Singh/APShare
Updated at 17.06 EDT
$2m for Indigenous racism register
An online register of racism and discrimination against First Nations people is receiving up to $2m in Commonwealth funding to help inform anti-racism action, AAP reports.
The federal government has announced the funding before the final report by a parliamentary inquiry into racism, hate and violence directed at Aboriginal and Torres Strait Islander people.
The minister for Indigenous Australians, Malarndirri McCarthy, said the parliamentary inquiry had heard confronting stories from Indigenous people about the hurt and harm they had experienced.
double quotation markWhile we await the committee’s final report, we are not waiting to act.
This investment will strengthen the important work of Call It Out and support efforts to collate rigorous data.
Callitout.com.au is a culturally safe, trauma-informed website that collects data for analysis by the Jumbunna Institute to help raise awareness and drive systematic change.
Updated at 16.58 EDT
Chalmers weighs in on One Nation WA byelection win
Achol Arok
Jim Chalmers says he has reflected on the key takeaways after One Nation candidate Luke Herdegen secured 57%of the vote after preferences at the Secret Harbour byelection.
Speaking on ABC’s 7.30, Chalmers said he acknowledged that concerns about inflation, the cost of living and real wages were on voters’ minds before the poll.
double quotation markI have thought very deeply about the legitimate concerns and anxieties and frustrations that people have. About how the economy works, or doesn’t work for people. That’s the thing I’m most focused on. It’s the whole reason for our efforts to get inflation down, to make the economy more productive.
Chalmers added he believes the “faultline in our politics” is now changing.
double quotation markIt’s not necessarily between the centre left and the far right, it’s not necessarily the old distinctions. The distinction in our politics right now is a Labor government working to address the very real concerns that people have, versus the Liberals and Nationals and One Nation who just want to prey on that, and pick on that.
One Nation’s Luke Herdegen. Photograph: Richard Wainwright/AAPShare
Updated at 17.13 EDT
Chalmers defends house prices forecastAchol Arok
Jim Chalmers has defended Treasury’s forecast on the impact of the government’s recent tax changes on housing, after the Commonwealth Bank predicted prices could fall by almost 10% across capital cities.
Treasury modelling said the changes would reduce house price growth by just 2% over the next couple of years.
Speaking on ABC’s 7.30, the treasurer said the new data did not fairly challenge the government’s forecast.
double quotation markThat Commonwealth Bank forecast that you reference in your question has house prices recovering next year, and so it’s a really important reminder that we need to compare ‘like with like’.
The assumptions in the budget are over the next couple of years, not the first couple of months since the budget … and the Commonwealth Bank says they expect house price growth as soon as next year.
Chalmers pointed to several factors unrelated to the recent tax changes that he said would contribute to the dip in prices.
double quotation markThere is softness in the housing market, prices have come off a bit, auction clearance rates have come off a bit, but that was beginning before the budget, and that’s because, as a number of experts have pointed out, one of the big influences is interest rates.
We have very substantial advantages in the face of some serious economic challenges. Productivity is one of them. Inflation is another. Extreme global volatility, turbocharged by a war on the other side of the world.
Treasurer Jim Chalmers. Photograph: Lukas Coch/AAPShare
Updated at 17.15 EDT
Welcome
Good morning and welcome to our live news blog. I’m Martin Farrer with the top overnight stories and then it will be Nick Visser with the main action.
Let’s begin.