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Westpac profit dips as CEO Miller sees rates challenging clients

(Bloomberg) — Westpac Banking Corp. profit slipped as Chief Executive Officer Anthony Miller said the high cost of living in the Australian economy continues to bite into customers’ spending power.

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Unaudited net profit for the three months ended Dec. 31 came in at A$1.7 billion ($1.1 billion), the Sydney-based bank said in a statement Monday. Hedging contributed to the bulk of the fall, with margins and profit otherwise flat.

Just months into the job, Miller has taken the helm at Westpac as the Australian economy heads toward a phase of expected monetary policy easing that could curb bank margins. Analysts are also wary about the outlook after the stock price soared more than 40% over the past year.

“Cost of living pressures and high interest rates remain challenging for some customers while many businesses face cost pressures and lower demand,” Miller said in the statement. “Encouragingly, inflation has eased and we could see the Reserve Bank of Australia reduce the cash rate as early as tomorrow.”